China: Industry Profits Rising

In the first 7 months of 2024, profits of China’s largest industrial companies rose 3.6% compared to the same period last year. According to data released by National Bureau of Statistics of China (NBS), “companies with annual surpluses of 20 million yuan or more achieved cumulative profits of 4.1 trillion yuan ($575 billion) between January and July.”

Profits of the largest companies, which have risen for two consecutive months, grew 4.1% year-over-year in July, compared with a 0.5% increase in June. According to NBS analysts, “the growth in corporate profits was mainly driven by high-tech manufacturing.” In this sector, profits grew by as much as 12.8% year-on-year between January and July. Profits from the consumer goods industry also grew by 10.2% in January-July compared to the corresponding period in 2023. This is a very positive indicator, with China’s domestic consumption steadily recovering, as is the demand for Chinese products destined for export, which is growing every month despite the trade retaliation measures imposed by the United States and the European Union.

Meanwhile, in the United States, the election battle between Republicans and Democrats is centered on economic and trade cooperation between the USA and China. Ohio Senator J.D. Vance, the Republican candidate for US vice president, accused President Joe Biden’s administration of “allowing the Chinese company Gotion to build – thanks in part to subsidies offered by the United States to that renewable energy sector – an electric battery plant in Michigan.”

As US media reminds us, “in October 2022, Michigan Democratic Governor Gretchen Whitmer authorized a $2.36 billion project to build a Gotion electric car battery plant in her state that should create 2350 jobs.”

During a campaign rally in Big Rapids, Michigan, Vance criticized, among others, Vice President Kamala Harris, the Democratic candidate for the White House, citing her vote to allow the approval of a huge spending plan in the Senate in 2022, calling it the Inflation Reduction Act: “This vote also gave Chinese companies like Gotion access to millions of taxpayer dollars,” said the senator, according to whom “Democrats are helping China.”