China's manufacturing PMI rebounds in March as coronavirus outbreak eases

China reported visible recovery in economic activities in March as the domestic novel coronavirus disease (COVID-19) situation began to ease, with the manufacturing activity index re-entering the expansion zone after a weak February reading, official data showed Tuesday.

A worker checks on an automatic glass production line in Shahe City, north China's Hebei province, March 28, 2020. [Photo/Xinhua]

The purchasing managers' index (PMI) for China's manufacturing sector firmed up to 52 in March from 35.7 in February, according to the National Bureau of Statistics (NBS).

The above-expectation manufacturing PMI came as the country's arduous efforts in coordinating epidemic control and economic and social development have generally filtered through, according to Zhao Qinghe, a senior statistician with the NBS.

About 98.7 percent of China's manufacturing enterprises have reported work resumption, pulling the PMI of enterprises upward dramatically, NBS survey showed.

Improvements were showed in both the supply side and demand side, with both indices seeing a double-digit increase in the past month, according to the data.

PMI for high-tech manufacturing, equipment manufacturing and consumer goods all stood in expansion zone, deriving vitality from the quickened restoration of the sector.

Meanwhile, the PMI for China's non-manufacturing sector also bottomed out to come in at 52.3, up from 29.6 in February. The PMI of the service sector, once dragged by the COVID-19 outbreak, also posted double-digit growth to stand at 56.8, data showed.

However, the NBS said in a note on its website that a single-month rise does not necessarily mean the production has been back to pre-outbreak levels, noting that more data should be observed and the global spread of the virus has brought new challenges to the domestic economy.

The upturn of economy, the bureau said, requires more than three consecutive months of an upward trend in PMI.

Wen Tao, an analyst with the China Logistics Information Center, explained that the higher month-on-month PMI was partly due to a low comparison base in February when the economy was almost at a standstill hit by the epidemic.

Noting that the rapid overseas spread of the virus has made the global trade market grim, more attention should be paid to prevent the country's exports from being depressed, Wen said.

To facilitate production resumption in the trade sector, the country has resorted to policy tools such as export tax rebates and export credit insurances for foreign trade firms and introduced measures to help them secure orders and maintain market shares.

Xin Guobin, vice minister of the Ministry of Industry and Information Technology, warned of constraints on industrial and supply chains, especially when the global COVID-19 pandemic disrupts the cross-border flow of goods, personnel and capital.

Leading enterprises in China's key industries are encouraged to give a hand to their upstream and downstream enterprises to keep the supply chain stable, he said.

But Xin struck a confident tone on China's economic resilience and vitality against the complicated situation, citing complete industrial system, great domestic demand and ample policy room.

The impacts of the epidemic on China's economy are short-lived and controllable, and the economic fundamentals for long-term sound growth remain unchanged, he said.