China's machinery sector sees slow recovery in H1

Data released by an industrial association on Tuesday indicates a slow-paced recovery in the nation's machinery sector amid an economic slowdown.

The sector's industrial value-added output rose 9.2 percent year on year. The growth rate also marked a 0.2-percentage point rise compared to the same period last year, according to data released by the China Machinery Industry Federation (CMIF).

In 2012, the industrial value-added output grew 8.4 percent.

Meanwhile, profitability of enterprises in the sector rose more quickly in the first half. The sector's total profits hit 600.1 billion yuan (97.2 billion U.S. dollars) in the first six months of 2013, up 12.58 percent year on year. The growth rate picked up by 10.64 percentage points from the same period last year, the data showed.

New orders at major machinery enterprises also began rising since the start of the year, with the total contract value of the orders up 3.78 percent year on year in the first six months, up 3.46 percentage points from the first quarter, the data showed.

"This tells us a sign that the slow recovery could be extended into the second half of this year," CMIF vice president Cai Weici said.

Cai said the outlook for machinery exports was grim.

He said that the sector's Jan.-June exports value stood at 175.3 billion U.S. dollars, up only 1.51 percent year on year. The growth rate dropped by 7.76 percentage points compared to the beginning of the year, and was 8.89 percentage points lower compared to the country's total exports growth during the six-month period.

Sagging demand for traditional machinery products have forced more companies to enhance innovation, cut down costs and drive growth.

Meanwhile, private companies have demonstrated more vigor, with their business revenues hitting 5.3 trillion yuan in the first half, accounting for 56.02 percent of the market share, Cai said.

Cai forecast that profits of the machinery sector will rise 8 percent this year, and both production and sales are expected to grow at around 12 percent.