21st Century Business Herald:

Data on industrial production in November showed slightly increased growth compared to the previous month. What was behind this? Will the recovery in industrial growth be sustained? And the PMI remained within the expansion range for two consecutive months in October. What was the reason for the improved PMI? Thank you.

Fu Linghui:

Thank you for your questions. Since the beginning of this year, industrial production has been a highlight of the economy, generally maintaining steady and rapid growth. Benefiting from macro policies, industrial growth increased steadily in November. The manufacturing sector grew rapidly, new growth momentum continued to expand, and enterprise expectations improved. All these contributed to the stable economic performance. More specifically:

First, production was steady and improved. The value added of industrial enterprises above designated size grew 5.4% year on year in November, 0.1 percentage point higher than the previous month. The value added of manufacturing, which is the mainstay of the industrial sector, increased by 6%, 0.6 percentage point higher than the previous month. Industrial production was driven significantly by exports. The export delivery value of industrial enterprises above designated size grew 7.4% year on year in November, up 3.7 percentage points from the previous month.

Second, positive signs were seen in industrial upgrading. As we promote high-end development of the industrial sector and large-scale equipment upgrades, high-tech and equipment manufacturing both realized rapid growth. In November, the value added of high-tech and equipment manufacturing grew 7.8% and 7.6%, respectively, significantly outpacing the overall growth of industrial enterprises above designated size. In terms of industries, automobiles and electronics showed good growth momentum. In November, the value added of automobile manufacturing, and computers and other electronic equipment manufacturing grew 12% and 9.3%, respectively. In terms of products, output of products with high added value grew rapidly. In November, output of integrated circuits and industrial robots grew 8.7% and 29.3%, respectively.

Third, the transition to intelligent and green development has continued. Driven by policies to promote high-quality industrial development, the intelligent and green development of the manufacturing industry has become increasingly prominent, with rapid growth in the production of intelligent equipment and green products. In November, the added value of intelligent unmanned aerial vehicle manufacturing and intelligent onboard equipment manufacturing increased by 60.6% and 13.9%, respectively; and the output of new energy vehicles and solar cell products increased by 51.1% and 10.9%, respectively.

Fourth, business expectations have improved. Overall, as macroeconomic policies take effect and market demand improves, the PMI of manufacturing enterprises has continued to rebound since September. In November, the manufacturing PMI was 50.3%, up 0.2 percentage point compared with the previous month, marking a continuous rise for three consecutive months and remaining above the 50-point threshold for two consecutive months. The manufacturing production and operation expectation index increased by 0.7 percentage point compared with the previous month, signaling increased business confidence in future market prospects.

Overall, industrial production increased steadily in November, with continued improvements to the industrial structure, sustained advancements in the transition to high-end, intelligent and green production, and improved business expectations. However, some industrial enterprises are still facing challenges, such as inadequate market demand, intensified competition and profitability issues, resulting in considerable operating pressure. Going forward, we will focus on implementing policies to support industrial development, expanding domestic demand, improving and adjusting industrial capacity, and strengthening sci-tech innovation and industrial innovation, to promote the high-quality development of industry. Thank you.