China Economic Watch: SOE Gross Profits Drop 11.6% in 1H; FDI Falls 6.9% in Jun

SOE Gross Profits Drop 11.6% in 1H
China's state-owned enterprises reported ¥19.84 trillion in revenues and ¥1.02 trillion in gross profits in 1H 2012, up 11.1% and down 11.6% year on year respectively as expenses rose 12.8% during the period, the Ministry of Finance said.

FDI Falls 6.9% in Jun
Foreign direct investment in China declined 6.9% from a year earlier to $12 billion in June amid anemic global economic growth, the Ministry of Commerce said. In 1H 2012, the nation's FDI dipped 3% year on year to $59.1 billion.

Offshore Non-Financial Investment Up 48% in 1H
China's offshore non-financial investment shot up 48.2% year on year to $35.42 billion in 1H 2012, the Ministry of Commerce said. The nation invested in 2,163 foreign firms across 116 countries and regions during the period. Of the $35.42 billion, $11.8 billion was invested in mergers and acquisitions. China's total offshore non-financial investment amounted to $357.5 billion as of the end of June.

Growth in Power Usage Slows in 1H
China's electricity consumption rose 5.5% year on year to 2.37 trillion kW hours in 1H 2012; the growth rate was 6.7 percentage points slower than in 1H 2011, the State Electricity Regulatory Commission said.

Rail Investment Tipped to Double in 2H
Investment in China's railway infrastructure will likely double in 2H 2012 from the previous six months as part of government efforts to revive a sputtering economy, the second biggest in the world, according to the Ministry of Railways. Railway infrastructure investment fell 36.1% year on year to ¥177.75 billion in 1H 2012.

China Upgrades Solar Power Target
China plans to install 21GW of solar power capacity for electricity generation during the five years through 2015, up from its original target of 15GW, according to the National Energy Administration.

IMF Cuts China Growth Outlook
The International Monetary Fund has lowered its forecast for China's economic growth to 8% this year and 8.5% next year, down 0.2 and 0.3 percentage points respectively. The IMF also cut its forecast for global economic growth to 3.5% this year and 3.9% next year.

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