MNI: China Jan-Nov Investment Continued 8-month Slowdown

-- Infrastructure Investment Showed Unexpected Strong Growth

-- Weaker Property Investment A Major Drag

     BEIJING (MNI) - Chinese fixed-asset investment growth in the first 11

months this year decelerated slightly from the January to October period and was

the lowest growth rate in over 18 years, due largely to a slowdown in property

investment, according to data released Thursday by the National Bureau of

Statistics.  

     Fixed-asset investment totaled CNY57.51 trillion in the January-November

period, up 7.2% from the year-earlier period but lower than the 7.3% gain in the

first 10 months and in line with the 7.2% increase expected in a Market News

Survey. 

     The headline growth rate was the lowest since the January-December 1999

period, when it was just 6.3%. It was the eighth consecutive month this year

that the year-to-date investment growth rate has slowed.

     Even so the seasonally adjusted month-on-month was 0.53% in November, up

slightly from October's 0.51% rate.

     Among the three main investment sub-indexes, infrastructure investment

edged up, investment in manufacturing remained stable, but the property

investment fell sharply.   

     Infrastructure investment growth rose to 20.1% year-on-year in the

January-November period, 0.5 percentage point higher than the January-October

period, due to strong fiscal support. 

     "Private investment maintained stable momentum and infrastructural

investment that benefitted people's livelihoods grew at a fast pace," NBS

spokesman Mao Shengyong told journalists during a briefing on Thursday. 

     Investment in manufacturing grew 4.1% y/y in the first 11 months, the same

rate as in the first 10 months of this year. 

     Given the increase in industrial profits in the first 10 months this year,

the stable manufacturing investment result indicated that the carry-through

effect of profit growth to stronger investment is comparatively weak, Zhang

Deli, analyst with Lianxun Securities told MNI. 

     Industrial investment grew 3.1% y/y to CNY21.18 trillion, down 0.2

percentage point from the January-October period. Mining sector investment

decreased 10.2% on an annual basis, a bigger decline than the 9.1% drop during

the first 10 months. 

     Investment in the agricultural sector grew 11.4% year-on-year to CNY1.90

trillion in the first 11 months, down 1.7 percentage point from the first 10

months, the NBS said. 

     Investment in the services sector grew 10.1% to CNY34.15trillion in the

first 11 months, up 0.1 percentage point from the January-October period, the

NBS noted.

     The fix-asset investment in the Northeast region increased 0.1% to CNY2.85

trillion, compared with the 3.2% decline in the first 10 months.

     "The economy in the Northeast region is recovering, indicating coordinated

development between regions is improving," Mao said. 

     However, the national-wide property investment growth slowed 7.5% to

CNY10.34 trillion, with the growth rate 0.3 percentage point below that in the

first 10 months. The November property investment growth rate was the lowest in

2017.

     In the first 10 months this year, private investment, a main contributor to

overall growth, also slowed to 5.7% from 5.8% in the January-October period.

Private sector investment accounted for 60.5% of total fixed-asset investment

during the first 11 months of the year.

     "Investment will remain stable next year and property investment will not

see major volatility," Mao predicted.

--MNI Beijing Bureau; +86 (10) 8532 5998; email: marissa.wang@marketnews.com

--MNI BEIJING Bureau; +1 202-371-2121; email: john.carter@mni-news.com

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