Curbs cool output, FAI
By Winny Wang |
January 22, 2010, Friday
|
Print Edition
Print Edition
The growth in China's industrial output and urban fixed-asset investment cooled in December after government's curbs on overcapacity, overheating and possible asset bubbles.
Industrial output grew 18.5 percent last month from a year earlier, slower than a 19.2 percent increase in November.
Urban fixed-asset investment surged 30.5 percent last year, against a 32.1 percent jump through November, the National Bureau of Statistics said yesterday.
"The government's efforts to stem overcapacity will work to slow production growth," said Alaistair Chan, an analyst at Moody's Economy.com. "Twenty-one out of 24 industrial sectors are seeing overcapacity, according to the Chinese Academy of Social Sciences, and the government will force consolidation in some, such as steel makers."
The output of crude steel rose 26.6 percent to 47.66 million tons, compared with a 37.4 percent increase in November. Auto output surged 130.5 percent to 1.54 million units, faster than a 100.8 percent jump a month earlier.
"Motor vehicle sales will be dampened by a partial phasing out of a tax break in 2010, and this will hurt production," Chan said.
Industrial output for 2009 rose 11 percent, slower by 1.9 percentage points from 2008 and the slowest pace since 1999. In the first 11 months, factories earned 2.59 trillion yuan (US$379 billion) in profit, up 7.8 percent and rising by 2.9 percentage points from a year earlier.
"Slower bank lending for 2010 will slow fixed-asset investment and industrial production," Chan said.
Urban FAI rose 30.5 percent in 2009 to 19.41 trillion yuan. Infrastructure investment was 4.19 billion yuan, 44.3 percent higher than a year earlier. Real estate investment grew 16.1 percent to 3.6 trillion yuan in 2009, slowing from 20.9 percent growth in 2008.
"China's fixed-asset investment growth has been slowing since October as the economy addresses overcapacity, overheating and possible asset bubbles," said Tine Olsen, an analyst of Moody's.
Industrial output grew 18.5 percent last month from a year earlier, slower than a 19.2 percent increase in November.
Urban fixed-asset investment surged 30.5 percent last year, against a 32.1 percent jump through November, the National Bureau of Statistics said yesterday.
"The government's efforts to stem overcapacity will work to slow production growth," said Alaistair Chan, an analyst at Moody's Economy.com. "Twenty-one out of 24 industrial sectors are seeing overcapacity, according to the Chinese Academy of Social Sciences, and the government will force consolidation in some, such as steel makers."
The output of crude steel rose 26.6 percent to 47.66 million tons, compared with a 37.4 percent increase in November. Auto output surged 130.5 percent to 1.54 million units, faster than a 100.8 percent jump a month earlier.
"Motor vehicle sales will be dampened by a partial phasing out of a tax break in 2010, and this will hurt production," Chan said.
Industrial output for 2009 rose 11 percent, slower by 1.9 percentage points from 2008 and the slowest pace since 1999. In the first 11 months, factories earned 2.59 trillion yuan (US$379 billion) in profit, up 7.8 percent and rising by 2.9 percentage points from a year earlier.
"Slower bank lending for 2010 will slow fixed-asset investment and industrial production," Chan said.
Urban FAI rose 30.5 percent in 2009 to 19.41 trillion yuan. Infrastructure investment was 4.19 billion yuan, 44.3 percent higher than a year earlier. Real estate investment grew 16.1 percent to 3.6 trillion yuan in 2009, slowing from 20.9 percent growth in 2008.
"China's fixed-asset investment growth has been slowing since October as the economy addresses overcapacity, overheating and possible asset bubbles," said Tine Olsen, an analyst of Moody's.
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