Chinese manufacturing weakens amid COVID-19 outbreak

AP , Saturday 31 Dec 2022

Chinese manufacturing contracted for a third consecutive month in December, in the biggest drop since early 2020, as the country battles a nationwide COVID-19 surge after suddenly easing anti-epidemic measures.

Beijing, China
File Photo: Shoppers walk through a reopened shopping mall after authorities started easing some of the anti-virus controls in Beijing on Dec. 6, 2022. AP


A monthly purchasing managers' index declined to 47.0 from 48.0 in November, according to data released from the National Bureau of Statistics on Saturday. Numbers below 50 indicate a contraction in activity.

The contraction was the biggest since February 2020, when the COVID-19 pandemic had just started.

The weakening comes as China earlier this month abruptly relaxed COVID-19 restrictions after years of attempts to stamp out the virus. The country of 1.4 billion is now facing a nationwide outbreak and authorities have stopped publishing a daily tally of COVID-19 infections.

In several other sub-indexes, including large enterprises, production and demand in the manufacturing market also dropped compared to November.

``Some surveyed companies reported that due to the impact of the epidemic, the logistics and transportation manpower was insufficient, and delivery time had been extended,'' said Zhao Qinghe, a senior economist at the statistics bureau in a published analysis of the December data.

According to data from the bureau, sectors including construction saw expansion in December together with sub-indexes that measure industries such as air transport, telecommunications, and monetary and financial services.

The purchasing managers' index for China's non-manufacturing sector also fell to 41.6 in December, down from 46.7 in November.

China is likely to miss its goal of 5.5% economic growth this year, with forecasters cutting their outlook to as low as 3% in annual growth, which would be the second weakest since at least the 1980s.

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