China's manufacturing PMI Photo: Xinhua

The profits of industrial enterprises above designated size in August reached 612.81 billion yuan ($89.8 billion), up 19.1 percent year-on-year, as the production and operation of enterprises have returned to normal and the supply and demand cycle has largely improved thanks to the government policies to stabilize and support the industry.   

The National Bureau of Statistics (NBS) said in its report on Sunday that from January to August, the total profits of industrial enterprises above designated size nationwide reached 3.71 trillion yuan, and although down 4.4 percent year-on-year, the decline narrowed by 3.7 percentage points from January to July. 

A number of industries showed positive profit growth, among which the most significant one was the computer, communication and other electronic equipment manufacturing industry, whose total profit increased by 26.1 percent year-on-year, highlighting China's rapid development in the technology field in the post-epidemic era. In addition, the special equipment manufacturing industry and the agricultural and sideline food processing industry also grew rapidly driven by the market demand, with growth rates of 22.9 percent and 17.7 percent respectively.

Meanwhile, the profits for equipment manufacturing industry has maintained a rapid growth, with the amount of enterprise losses declining, which also contributed to the recovery. 

Senior NBS statistician Zhu Hong attributed the profit growth in August and the narrowed decline to the implementation of pandemic prevention and control efforts and a series of social and economic development policies.

The increase in profits was mainly driven by the stable recovery of production and demand, continuous decline in unit costs, and significant recovery in mining profits and accelerated growth in raw material manufacturing profits, Zhu said.

In August, with major achievements made in the prevention and control of the pandemic in China, the implementation of supportive policies become more and more effective, experts said.

As a country that managed to quickly resume business and production after the successful containment of the pandemic, China's industrial recovery is of great importance not only to China but also to the world economy in the wake of the outbreak.

Although the stable recovery of industrial enterprises' profits was further consolidated in August, Zhu noted that the growth rate of industrial enterprises' operating income and profits from January to August has not yet turned positive, and the growth rate of accounts receivable continues to rise. 

At the same time, due to the complex and changeable environment at home and abroad, the sustained and stable growth of corporate profits is still under certain pressure. 

In the next stage, China will continue to focus on supply-side structural reform, further tap the potential of domestic demand, stimulate the vitality of market players, and focus on unimpeded supply and demand cycles, the report said.