China’s manufacturing industry has grown for three consecutive months

China’s manufacturing industry has grown for three consecutive months An important indicator measuring China's huge manufacturing industry released on Tuesday showed that the industry had grown for three consecutive months in December...

A key measure of China's vast manufacturing sector released on Tuesday showed it had grown for three straight months through December, bolstering the view that the world's second-largest economy has begun a modest rebound that could continue into 2013.

On the first day of the new year, the National Bureau of Statistics released a survey on the manufacturing purchasing managers index (PMI). The survey showed that the PMI index in December was 50.6%. A PMI above 50% means industry growth, while a PMI below 50% means industry shrinkage.

On Monday, HSBC released a similar survey, which also showed that the industry's rebound momentum was becoming increasingly solid. Compared with the official index, HSBC's index focuses more on small private companies. December's value was 51.5%, a full percentage point higher than November, reaching the highest value in 19 months.

For most of 2012, China's economy was in a state of significant slowdown. In the last few months of the year, China's economy began to regain momentum. A modest increase in exports, coupled with economic support measures such as government-led infrastructure spending, dispelled fears of a "hard landing" in the final quarter of 2012. Analysts generally estimate that China's economy grew by about 8% in 2012 and will achieve the same or even slightly stronger growth in 2013.

However, analysts also warned that China's economy needs to deal with a series of major challenges, and China's economic growth may slow down by several percentage points in the next decade.

On Tuesday, ANZ economists Li-Gang Liu and Louis Lamb Lam commented in a research report, "In the future, China's cyclical rebound will still encounter strong resistance. Uncertainties in the economy and policies of the United States and the European Union mean that external demand for Chinese exports will remain weak."

Domestically, the government is busy dealing with rampant corruption, environmental deterioration, and the widening gap between rich and poor, as well as the need to weaken the dominance of state-owned enterprises. Analysts believe that if sustained growth is to be achieved, economic development should be driven by domestic demand rather than government-guided investment and exports.

China's rapidly changing demographic structure also brings considerable time pressure, as aging will lead to a surge in the number of people without income in the coming years.

At a media briefing last month, Yao Wei, an economist at Société Générale in Hong Kong, said, “The main issue is not to maintain short-term growth momentum, but how to get China to do it. "Be prepared to face future demographic challenges." She added, "Within 10 years, China's demographic structure will be worse than South Korea and Japan. The window of opportunity for policymakers is closing rapidly."

Translation: Liang Ying. New York Times Chinese website