China December industrial profits fall 4.7%, dragged down by slowing economy

Profits earned by Chinese industrial firms in December fell 4.7 per cent from a year earlier.
Profits earned by Chinese industrial firms in December fell 4.7 per cent from a year earlier. PHOTO: AFP

BEIJING (REUTERS) - Profits earned by Chinese industrial firms in December fell 4.7 per cent from a year earlier, the seventh straight month of decline, as the slowing economy hit sales and forced many companies to cut prices to win business.

Industrial profits - which cover large enterprises with annual revenue of more than 20 million yuan (S$4.3 million) from their main operations - fell 2.3 per cent in 2015 from 2014, the National Bureau of Statistics(NBS) said on its website on Wednesday (Jan 27).

That compared with 3.3 per cent growth in 2014. High costs and tight liquidity curbed companies' production and operations, along with weak domestic and global demand, the NBS said.

China's economic growth cooled to 6.9 per cent in 2015, the slowest pace in a quarter of a century, weighed down by sluggish demand, industrial overcapacity, slowing investment and a struggling property market.

Producer prices fell for the 46th month in a row in December, highlighting the deeply entrenched pressures facing its manufacturers.