China’s manufacturing in crisis

Manufacturing in China has now succumbed to the global recession as weak demand has meant that China’s manufacturing is now in crisis.

In a bid to take action, the Chinese government has introduced cash into the manufacturing industry in a bid to boost infrastructure and stabilise the industry.

The government has already lowered interest rates three times in just two months, as well as increasing rebates and property taxes in order to help Chinese exports.

Manufacturing demand has fallen as the Purchasing Managers’ Index fell to 44.6 last month from 51.2 in September.

It has been a steady and prolonged downfall as manufacturing first began to slow down in July 2005, while in October 2008 it has recorded an all-time low.

As part of the global slowdown, China’s economy has slowed at its fastest rate in over 5 years and so it is clear that the government needs to take a more active role in priming the economy into action.

Falling property prices, as well as reduced exports, have also caused growth to slow and industries such as energy, metallurgy, textile, automobiles and electronics have all struggled.

Chinalco Luoyang Copper Co, a Chinese processor of the metal, said orders have fallen by 20 percent in the last quarter as a result of a reduction in global demand.

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