BEIJING — Chinese manufacturing business activity waned slightly in December but was still expanding, official data showed on Jan 1.
The manufacturing purchasing manager’s index (PMI), a key measure of factory activity in China, posted at 50.1 in December, down from 50.3 in November, according to the data released by the National Bureau of Statistics (NBS) and the China Federation of Logistics and Purchasing.
A reading above 50 indicates expansion, while a reading below 50 represents contraction.
In terms of the size of the surveyed enterprises, the PMI of large manufacturers posted 51.4, down from 51.6 in November.
That of medium enterprises stood at 48.7, up from 48.4 in November, but still in a state of contraction.
The PMI of small manufacturers slumped to 45.5, down from 47.6 in November, and remained in the contraction territory, the NBS said.
Among the subindices of the PMI, the production index posted at 52.2 percent, down from 52.5 in November.
The index of new orders slipped to 50.4, down from 50.9 in November. The employment index was 48.1, down from 48.2 in November.
Manufacturing needs to adapt to changes
Although China’s manufacturing price advantage is eroding due to rising wages and energy cost, the Asian country is still the world’s largest trading nation, said a report released by social sciences academic press on Dec 29.
The annual study with a focus on the current development of Chinese manufacturers showed that made-in-China goods have played a decisive role in the international competition although the labor intensive and low-end products still account for a large portion of export.
Zhang Qizi, researcher at the institute of industrial economics in Chinese Academy of Social Sciences, said that the soaring wages and higher energy cost have weakened the prowess of the Chinese manufacturing, as a result the nation will have to adapt to the change of population structure and quick changing demand.
“Currently immature financial services, soaring logistic cost and wages as well as weak competitiveness in the creative sector are some key factors restricting the development of the country’s manufacturing industry,” said Zhang, the key author of the report.
He said China has entered into a new stage of a structural adjustment, the sustainable ability of innovation in customized production and complex manufacturing will become core competitiveness of the industry.