China's industrial production contracted 2.9 pct in April

In April, China's industrial production contracted by 2.9 percent year-on-year, while retail sales fell 11.1 percent as the effects of Omicron flareups on the economy worsened.

Industrial production fell by 2.9 percent in April, down from a growth of 5 percent in March and lower than market expectations, according to data released by the National Bureau of Statistics NBS. Industrial production slowed down to 4 percent from a 6.5 percent increase in January-March.

The effects of the COVID 19 epidemic in April are temporary and external and the trend of high-quality development remains unchanged, said Fu Linghui, a spokesperson for the NBS.

Growth in energy and basic industries was unable to offset a slowdown in manufacturing which was hard hit in April with a sharp decrease in the auto sector, amongst others.

The growth was the lowest in over two years, as the April economy was facing unprecedented downward pressure since the first quarter of 2020 due to COVID-19 flareups, supply chain snags and external uncertainties arising from the Russia-Ukraine conflict.

In March, key localities for industrial production, including manufacturing hub Shanghai and Northeast China's Jilin Province, entered static management to combat the COVID 19 and extended into April.

Supply chains in the Yangtze River Delta - accounting for one-fourth of China's GDP - were also affected as Shanghai paused for the month.

The economy is expected to see improved performance in May, as the weather warms up and the domestic COVID situation comes under control, according to Fu.

Fu said that Shanghai and Jilin were already in the process of resuming work and production and recovering their economy.

China's GDP increased by 4.8 percent in the first quarter of 2022.