Summary: In May, as the central government's policies for coordinating epidemic prevention and control with economic and social development were gradually implemented, and as work resumption and production ramp-up advanced, industrial production continued to rebound.
Industrial Production Rebounds Steadily — Jiang Yuan, Deputy Director of the Department of Industry Statistics at the National Bureau of Statistics, interprets May industrial production data. In May, as the central government's policies for coordinating epidemic prevention and control with economic and social development were gradually implemented, and as work resumption and production ramp-up advanced, industrial production continued to rebound. However, cumulative industrial production from January to May still declined. In May, the pace of recovery in some industries and products weakened, and with a complex external environment, the stable operation of the industrial economy still faces many difficulties and uncertainties.
First, work resumption and production ramp-up advanced steadily, and industrial production accelerated. A sample survey of above-scale industrial enterprises shows that as of May 27, 67.4% of enterprises had reached more than 80% of normal production levels, up 6.6 percentage points from late April. In May, the value added of above-scale industries grew by 4.4% year on year, accelerating by 0.5 percentage points from the previous month and continuing to rebound after turning positive last month. Among the three major categories — mining, manufacturing, and the production and supply of electricity, heat, gas and water — output grew by 1.1%, 5.2% and 3.6% respectively, with growth accelerating across all three. From January to May, industrial value added fell by 2.8% year on year, with the decline narrowing by 2.1 percentage points compared with the January-April period.
Second, production in most industries and products continued to recover, and emerging products maintained rapid growth. By industry, in May, 30 of the 41 major industries saw year-on-year growth in value added, two more industries than in the previous month, giving a growth coverage rate of 73.2%. By product, among the 612 industrial products covered by statistics, output of 344 products increased, a growth coverage rate of 56.2%. Some emerging products continued to grow rapidly, with 3D printing equipment, smart watches, integrated circuit wafers and charging piles all growing by more than 70%.
Third, growth in the equipment manufacturing industry continued to accelerate, and infrastructure-related products showed sound growth. In May, the value added of the equipment manufacturing industry grew by 9.5% year on year, 0.2 percentage points faster than the previous month. Among them, the automobile manufacturing industry grew by 12.2%, accelerating by 6.4 percentage points, the highest monthly growth since the second half of 2018. Special equipment manufacturing grew by 16.4%, accelerating by 2.1 percentage points. Electronics, instrumentation, general equipment and other industries maintained relatively rapid growth, with growth rates ranging from 7.3% to 10.8%. By product, in May, output of construction machinery increased by 38.4% year on year, 17.5 percentage points faster than the previous month, of which excavators grew by 82.3%, accelerating by 32.8 percentage points. Large and medium-sized tractors and concrete machinery grew by 56.1% and 42.2% respectively. Automobile output reached 2.152 million units, up 19%, of which trucks accounted for 458,000 units, up 54.7%, with growth rates significantly accelerating from the previous month. Driven by recovering market demand, SUV production grew by 33.5% and notebook computers by 28.6%, while smartphone and smart TV production turned from decline to growth, up 8.4% and 7.1% respectively.
Fourth, growth in the raw materials industry accelerated somewhat, and production of cement, steel and other materials continued to improve. In May, as infrastructure construction accelerated, the year-on-year growth rate of value added in the raw materials industry rose from 3.5% in the previous month to 5.5%. Among them, the steel, non-metallic mineral products and chemical industries grew by 6.1%, 5.5% and 3.9% respectively, all with slightly faster growth than the previous month. The petrochemical industry turned from decline to growth, rising by 7.8%. By product, in May, cement, steel, ten non-ferrous metals and primary plastics grew by 8.6%, 6.2%, 4.1% and 7.9% respectively year on year, all with faster growth than the previous month.
At present, industrial production is generally recovering, but difficulties and uncertainties remain numerous and deserve attention. First, the pace of recovery in some industries and products has weakened. Among 41 industries, 25 saw slower growth or a wider decline, and the product growth coverage rate declined from the previous month. Second, the consumer goods industry declined, with growth turning from 0.7% in the previous month to a decline of 0.6%. Clothing, furniture, cultural, educational and arts & crafts products, and leather and footwear industries fell by between 5.0% and 11.4%. Third, export orders were insufficient, with industrial export delivery value turning from growth to decline, down 1.4% year on year. In some industries with a high share of exports, export delivery value fell by more than 10%.
Going forward, efforts should continue to solidly carry out the work of ensuring stability on six fronts, implement the tasks of guaranteeing security in six areas, promote tax and fee reductions, encourage and help foreign trade enterprises explore the domestic market, assist small, medium and micro enterprises severely impacted by the epidemic, and continuously consolidate the trend of steady recovery in the industrial economy.