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China\u2019s industrial profits returned to growth in August, as Xi Jinping piled pressure on businesses to combat aggressive price competition stemming from industrial overcapacity. <\/p>\n
Profits at industrial companies with annual revenues of more than Rmb20mn ($2.8mn) increased 20.4 per cent in August compared to a year earlier, and an improvement on a decline of 1.5 per cent in July. <\/p>\n
The August bump meant profits in the period from January to August were 0.9 per cent higher than during the same period in 2024, compared with 1.7 per cent lower in the January- to-July period.<\/p>\n
China\u2019s economy has been struggling with a years-long slowdown in the property sector, weak domestic demand and increased tariffs on its exports to a number of countries, particularly the US.<\/p>\n
In recent months, Xi has called on businesses to do more to stop price competition, the result of overcapacity in many sectors. Manufacturers, particularly in the massive electric vehicle sector, have engaged in brutal price wars to attract customers and win market share.<\/p>\n
The National Bureau of Statistics said the boost to profits in August was helped by a low base effect relative to profits last year as well as government efforts to promote a \u201cunified national market\u201d. <\/p>\n
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