China’s industrial firms’ profits sank to the lowest in a decade, with mining, manufacturing, and power sectors all suffering from steep declines due to the coronavirus impact.
Profits in the first two months of the year fell 38.3% year-on-year, to 410.7 billion yuan ($58.15 billion), an even steeper fall from the 6.3% decline in December last year, according to data by the National Bureau of Statistics.
The virus spread worsened during the week-long Lunar new Year. Travel bans and movement restrictions were implemented in the weeks that followed, delaying business reopenings.
The drop in profits meant more trouble to the manufacturing sector and analysts are expecting a decline in gross domestic product.
Automobile, electronics, electrical equipment, and chemicals industries saw the sharpest decline in profits, which was attributed to further pressures on factories in China.
Manufacturing output plunged at its fastest pace in almost three decades due to a disruption in operations.
Profits at state-owned industrial firms fell 32.9% year-on-year, while the private sector dropped 36.6%.
Liabilities at industrial firms rose 5.3% compared to the 5.4% increase by the end of 2019.