AFP and AP
March 14, 2014, 12:09 am TWN
BEIJING -- China's industrial production rose at its slowest pace in five years and other key indicators showed surprising weakness, data showed Thursday, raising alarm bells over the world's second-largest economy as Premier Li Keqiang outlined “serious challenges” ahead.
Industrial output, which measures production at factories, workshops and mines, rose 8.6 percent in January and February year-on-year, the National Bureau of Statistics said on its website.
The result was the lowest since the 7.3 percent recorded in April 2009, according to previous NBS data.
The statistics covered a two-month period due to China's Lunar New year holiday week, which fell in both months.
Retail sales, a key indicator of consumer spending, gained 11.8 percent in the two months from the year before, the lowest since an 11.6 percent increase in February 2011.
And fixed asset investment, a measure of government spending on infrastructure, expanded 17.9 percent during the first two months of 2014, the NBS added.
The pessimistic data set surprised economists and followed other recent indicators for manufacturing, trade and inflation that suggested weakness in China's economy, a key global growth engine.
China's gross domestic product (GDP) grew 7.7 percent in 2013, unchanged from the year before, which was the worst result since 1999.
Premier Li Keqiang announced earlier this month that it is targeting economic growth of about 7.5 percent in 2014, the same target it aimed for last year.
Li suggested to his once-a-year news conference after the close of the annual session of the National People's Congress (NPC), the Communist Party-controlled legislature, that the country faces roadblocks ahead.
“We are going to confront serious challenges this year and some challenges may be even more complex,” he said.
Li said China must “ensure steady growth, ensure employment, avert inflation and defuse risks” while also fighting pollution, among other tasks.
“So we need to strike a proper balance amidst all these goals and objectives,” he added. “This is not going to be easy.”
Zhou Hao, Shanghai-based economist for ANZ Bank, called Thursday's data “a complete mess” and said it showed that policies were needed to spur growth.
“Basically none of the figures were in line with expectations, all came in much lower than expected,” he told AFP.
A Wall Street Journal survey of 13 economists had yielded a median forecast of a 9.5 percent increase in industrial output and 13.5 percent for retail sales.
Societe Generale said in a research note that the results were a confirmation of “fast deterioration of China's economic growth.”
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