China industrial output growth at five-year low

Thursday 13 March 2014 08.02
China's industrial output sees slowest growth in nearly five years
China's industrial output sees slowest growth in nearly five years

China's industrial output rose 8.6% in January and February on a yearly basis, official data showed today.

This was the worst result in nearly five years and raised alarm bells over the world's second-largest economy.

The figure, which measures production at factories, workshops and mines, was the lowest since 7.3% was recorded in April 2009, according to previous NBS data.

Retail sales, a key indicator of consumer spending, gained 11.8% in the two months from the year before, the NBS said on its website. That figure was the lowest since an increase of 11.6% in February 2011.

Fixed asset investment, a measure of government spending on infrastructure, expanded 17.9% during the first two months of 2014, the NBS added. 

The statistics covered a two-month period due to China's Lunar New year holiday week, which fell in both months.

A Shanghai-based economist called the data "a complete mess" and said it showed that policies were needed to spur growth. "Basically none of the figures were in line with expectations, all came in much lower than expected," he said.

A Wall Street Journal survey of 13 economists yielded a median forecast of a 9.5% increase in industrial output and 13.5% for retail sales.

The figures come as China's leadership says it wants to transform the growth model away from an over-reliance on often wasteful investment, and instead make private demand the driver for the country's future development. 

China announced earlier this month that it is targeting economic growth of about 7.5% in 2014, the same as last year's target.

The country's gross domestic product (GDP) grew 7.7% in 2013, unchanged from the year before, which was the worst result since 1999.