The National Bureau of Statistics released data on China’s economy in May 2024, highlighting the combined functionality of all sectors. While the expansion of commercial production has slowed, foreign income and industry have increased, boosting retail sales, reflecting strong domestic demand in a stabilizing global economic environment.
China’s National Bureau of Statistics (NBS) has released economic signals for May, offering a comprehensive review of the functionality of industry, services, consumption, foreign industry and investment.
The data indicates a slowdown in the expansion of commercial production, with some production sectors still showing physically strong performances. On the other hand, consumption is increasing, driven by the expansion of services, retail sales and imports. The slight increase in these spaces suggests a strengthening of domestic demand, boosted by a stabilizing global economic scenario and the boost provided by Labor Day in early May.
China’s foreign industry also continued to show marked improvement, reflecting the country’s export functions and import expansion.
Despite these positive trends, demanding situations persist for economic momentum. The balance between boosting domestic demand and achieving strong trade expansion will be very important for China’s economic prospects in the coming months.
The annual expansion of China’s trade sector slowed in May from last month but remained strong. Total value-added trade production rose 5. 6% year-on-year in May, a monthly increase of 0. 3% but a slowdown of 6. 7% year-on-year. expansion recorded in April. Value-added output rose 6% YoY, a slowdown from 7. 5% YoY in April.
According to NBS spokesman Liu Aihua, aircraft production has played a role in stabilizing the overall trade expansion. The price of the sector increased by 7. 5% compared to last year, contributing 2. 6% of emissions to the expansion of all industries above the designated duration and accounting for 45. 7% of the overall expansion. Within this sector:
Some sectors of electronic and high-tech equipment production performed strongly:
However, the auto production sector slowed significantly, going from a 16. 3% year-on-year jump in April to a 7. 6% year-on-year expansion in May, likely due to declining domestic demand.
From January to May, the total value-added output of commercial enterprises over a given period (those with a significant annual revenue stream of more than RMB 20 million) increased by 6. 2% year-on-year. In particular, personal enterprises continued to outperform state-owned enterprises, with value-added output expanding by 5. 9% year-on-year, compared to 3. 6% for state-owned enterprises. At the same time, value-added production through foreign-invested enterprises (FIEs) rose to 2. 5% year-on-year.
In May, China’s services sector performed remarkably, contributing particularly to overall economic stability and growth. Several key factors, coupled with supportive macroeconomic policies, external demand, and the boost provided by Labor Day, have played a central role in the sector’s recovery.
The facility production index rose 4. 8% year-on-year in May, a 1. 3% improvement from last month. Labor Day last month particularly boosted tourism and similar activities. During the holidays, domestic tourist numbers and total spending increased by 7. 6% and 12. 7% year-on-year, respectively, while advertising profits (excluding entertainment venues) nationwide increased by 37. 2% year-on-year.
This increase in holiday travel and recreational activities has had a positive effect on the transportation, warehousing, postal services, accommodation and food services sectors.
Overall, several services sectors posted a healthy expansion in May:
Between January and May, the services output index increased by 5% year-on-year, and revenue from services of more than a fixed duration expanded by 8. 2% year-on-year.
Total retail sales of customer goods reached RMB 3. 92 trillion (540. 6 billion U. S. dollars) in May, up 3. 7 year-on-year, accelerating from 2. 3 percent growth. registered in April. Between January and May, total retail sales of goods for customers reached RMB 19. 5 trillion ($2. 7 trillion), up 4. 1 trillion year-on-year.
Highlights include:
The growth in sales of lifestyle products stands out, adding sports and entertainment items (20. 2%), cosmetics (18. 7%), communication devices (16. 6%) and household appliances and audiovisual devices (12. 9%).
Online retail sales continued to grow strongly, reaching RMB 5. 77 trillion in the first five months of the year, an increase of 12. 4% compared to 2023. Of this amount, online retail sales of physical products reached 4. 83 trillion RMB ($665. 64 billion). , an increase of 11. 5% year-on-year, representing 24. 7% of total retail sales for the period.
Between January and May 2024, retail sales of facilities increased by 7. 9% year-on-year. According to Yuan Yan, chief statistician of the NBS’s Department of Trade and Economics, the expansion rate declined compared to the January-April period, partly due to the upper base effect of the same period in 2023.
The expansion rate of retail sales of facilities was 4. 4 percentage points higher than that of retail sales of goods in this period.
Despite the increase in demand, inflation remained moderate in May, and the national customer value index (CPI) rose 0. 3% year-on-year, in line with the April rate. Food prices fell 2% year-on-year, paring last month’s decline through emissions of 0. 7%.
Thereof:
Prices of non-food products increased by 0. 8%, and the pace of increase decreased by 0. 1% compared to last month. Among non-food products, energy costs increased 3. 4% year-on-year, and the pace of accumulation decreased 0. 2% from last month. Construction prices increased 0. 8%, and the pace of construction remained the same as last month.
The core CPI, food and energy prices, increased by 0. 6% year-on-year.
China’s foreign industry increased in May, with a total industrial volume of RMB 3. 71 trillion (511. 8 billion U. S. dollars), a year-on-year increase of 8. 6 percent. Of this total, exports rose 11. 2% year-on-year to RMB 2. 15 trillion ($296. 3 billion). ), while imports rose 5. 2% year-on-year to RMB 1. 56 trillion ($215 billion).
Between January and May 2024, the total import and export volume reached RMB 17. 5 trillion (US$2. 42 trillion), a year-on-year increase of 6. 3%. Exports of mechanical and electrical products increased by 7. 9% year-on-year, representing 59% of total exports.
These figures imply a notable rebound after a difficult period. Throughout 2023, the country has struggled with stagnant industrial growth, a result of weakening demand in key export markets such as the EU and the United States. Total foreign industry in 2023 grew by 0. 2%, with exports growing by 0. 6%, while imports saw a slight decline of 0. 3% year-on-year.
In the first five months of 2024, China’s constant asset investment (FAI) reached RMB 18. 8 trillion ($2. 59 trillion), a year-on-year increase of 4%. Of this amount, public sector investment increased by 7. 1% year-on-year. , while investment in the personal sector increased 0. 1% year-on-year.
Excluding investment in real estate development, FAI increased by 8. 6 percent.
Breaking down investment by sector, investment in infrastructure increased by 5. 7%, investment in production by 9. 6%, while investment in real estate decreased by 10. 1%. In particular, investments in high-tech industries saw significant growth, increasing by 11. 5%. % year with year.
Foreign ISPs have continued to decline, reflecting the current demanding situations and uncertainties facing SOEs in China. Between January and May 2024, ISPs for EIA fell 15. 4% year-on-year, and the decrease expanded to 0. 2 issuances between January and April. In contrast, domestic business investment increased by 3. 8% year-on-year, and Hong Kong, Macao and Taiwan increased by 6. 6% year-on-year.
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