Business     

Business climate index drop in Q3

Xinhua, October 14, 2011

• China's business climate index, a major measure of macro-economic outlook, fell in the third quarter while entrepreneur confidence further weakened over the previous quarter, the National Bureau of Statistics (NBS) said Thursday.

  The quarterly business climate index, based on a survey of about 20,000 Chinese firms, dipped 2.2 points form the previous quarter to 133.4 in the third quarter, the NBS said in a statement on its website.

  The survey showed 90 percent of the enterprises interviewed believed production and the operational situation in the third quarter was better than or the same as in the second quarter.

  The index ranges from zero to 200. A reading above 100 shows economic expansion, while a reading below 100 indicates contraction. The business climate index has kept between the 130-138 range for eight consecutive quarters.

  Specifically, the index for the industrial sector posted declines both on quarterly and yearly bases, indicating slower growth of the country's manufacturing industry, according to the NBS.

  The business climate index for the real estate sector fell for three consecutive quarters due to the government's measures to curb the runaway property market, dropping below 120 points for the first time since the third quarter of 2009, according to the NBS.

  The index for the oil refining and coking sector, along with the nuclear fuel processing sector, slumped below the boom-or-bust line, suggesting contractions for both sectors.

  Analyzed by ownership, the index for the foreign- and overseas-funded business, as well as the private sector, posted gains in the third quarter, beating state-owned enterprises and other public-owned companies.

  If looking at the size of a company, large enterprises still outperformed the mid-sized and small companies in the third quarter, with their indexes at 151.3, 132.4 and 117.3, respectively.

  In addition, the entrepreneur confidence index, a gauge of the understanding, views and projections of business people faltered to 129.4 points for the third quarter, snapping a streak of standing above 130 points for six consecutive quarters.

  Entrepreneur confidence at all sectors tumbled in the third quarter, with executives in the real estate sector being those least confident amid China's housing tightening measures, according to the NBS.

  Entrepreneurial confidence for the property sector contracted 7.6 points to 99.9 in the third quarter after weakening for six consecutive quarters, according to the NBS.

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