Beijing, May 31 (IANS) China’s manufacturing activity slowed further in May as new export orders contracted and input costs kept rising, according to a survey by the country’s National Bureau of Statistics (NBS) released on Sunday.
The official manufacturing purchasing managers’ index (PMI) dropped to a three-month low of 50 from 50.3 in April, with the 50-point mark separating growth from contraction, the data showed.
While the supply rose during the period, the demand weakened further, with the sub-indexes for production and new orders estimated at 51.2 and 49.9, respectively, in the manufacturing PMI survey.
New export orders plunged to 48.6 from 50.3 during the month amid global uncertainties due to the Middle East conflict.
The figures will add to the concerns of the Chinese government, which is increasingly being confronted by the supply-demand mismatch, as the hitherto excessive dependence on exports that was driving growth is no longer providing the earlier momentum.
Other countries are also taking steps to check the flood of cheap Chinese goods that is hurting growth and employment in their domestic economies.
Major EU member countries are working towards taking stronger measures to prevent their economies from being hit by the flood of cheap goods from countries with “industrial overcapacity” such as China, according to a report in the South China Morning Post.
“A paper signed by Spain, Italy, the Netherlands, France and Lithuania days before a major China-focused debate in Brussels said the bloc must respond more aggressively to ‘systemic and structural industrial overcapacity’ — phrases often taken as shorthand for Beijing,” the report states.
The intervention comes as the European Commission prepares for a China policy orientation debate on Friday, designed to chart a new course in light of growing complaints from governments and industries about the economic pressure caused by Chinese competition.
The paper, which has not been released publicly and which was first reported on by the Financial Times, calls for much more aggressive use of EU safeguard measures for sector-wide disruption, rather than product-by-product anti-dumping cases.
These allow for tariffs or quotas to be imposed where import surges are seen to be harming local industry. They have been used sparingly in the past, notably to counter surges in Chinese steel and ferroalloys, which are products used in the steel industry.
–IANS
sps/sd/