Output rises 6.8% in May

Industrial sector plays key role in achieving stable growth as profits see big uptick

Industrial output saw sustained growth in May, providing further evidence of economic stability, according to official data issued on Thursday.

The nation's industrial output grew 6.8 percent year-on-year in May, which is 0.3 percentage points higher compared with the same period last year, according to data from the National Bureau of Statistics.

In the first five months, the indicator grew 6.9 percent year-on-year, the same level compared with the first four months of this year, according to the NBS.

Mao Shengyong, the bureau's spokesman, said the data showed that overall economic growth remained sound in recent months, during which time the industrial sector played a role in achieving stable growth. Major progress has been made in corporate profits and structural improvements, according to Mao.

From January to April, the profits of large-scale industrial enterprises rose 15 percent year-on-year, which is 3.4 percentage points higher than in the January to March period, according to the NBS.

The tax revenue of the industrial sector also maintained relatively stable growth, reflecting the improved efficiency of enterprises' operations, according to Mao.

Some promising signs can be found in structural improvements, such as high-tech manufacturing industries witnessing stable expansion.

From January to May, the added value of high-tech manufacturing increased 12 percent year-on-year, and the equipment manufacturing industry grew by 9.3 percent during the same period, according to official data.

Looking ahead, the economy is expected to remain on the right track and will not lose steam despite some external challenges, said Mao.

Liang Hong, chief economist with China International Capital Corp, wrote in a note on Thursday that the deleveraging process in the financial sector does not need to proceed too rapidly in order to stabilize the economy.

Deng Haiqing, chief economist with JZ Securities, wrote in a note on Thursday that China needs to cut leverage in a more accurate way in order to achieve the target.

Overall social financing, which is a broad measure of credit and liquidity in the economy, dropped to 760.8 billion yuan ($118 billion) in May from 1.56 trillion yuan in April, according to data from the central bank issued earlier this week.