CCP Advances Yet Its Private Sector receding – Industrial Enterprises Revenue Continued Deteriorating from Jan to July

On August 27, the National Bureau of Statistics of the Communist China released its financial data on major industrial enterprises from January to July. Overall, the operating costs of those above designated size increased faster than their operating income, compared with last year, it’s down 1.1% year-on-year. Among the 41 major industrial sectors, 25 of them suffered a profit decrease; only 16 had increased year-on-year. At the end of July, the asset-liability ratio of those big industrial enterprises increased by 0.2 percentage points year-on-year.

 According to this financial statistic data disclosed by the CCP, it shows two major features: First, the decline in profits is faster than that in revenue compared with last year. The profitability of enterprises has continued to decline. In the first two quarters, both the operating income growth rate and the total profit growth rate showed a significant and continuous downward trend. Compared with last year, the growth rate of total accumulated profits from January to June dropped by more than 30%, while the growth rate of total accumulated profits fell to -1.1%. The sharp drop in profits in July offset all profit growth in the first half of the year. At the same time, the proportion of cost in the operating income continues to rise, and the profit margin is hovering at a low level

 Second, the operating income and total profit of state-owned enterprises still maintain rapid growth, while the revenue growth of foreign-funded enterprises and private enterprises is sluggish. The growth rate of total profit has experienced a large negative growth. Among them, the income growth rate of state-owned holding enterprises was 11.4% with total profit growth rate of 8.0%; while the revenue growth rate of foreign-funded enterprises and Hong Kong, Macao and Taiwan enterprises was only 2.5%, and their profit growth rate was -14.5%; the revenue growth rate was -14.5%.