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China Focus: China's industrial production slows in August

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BEIJING, Sept. 13 (Xinhua) -- China's value-added industrial output expanded 6.9 percent year on year in August, down from 9-percent growth in July, the latest data showed on Saturday.

On a monthly basis, the industrial output in August expanded by a fractional 0.2 percent from July, the National Bureau of Statistics (NBS) said in a statement. In the first eight months, total value-added industrial output grew 8.5 percent from the same period last year.

August marked the second monthly retreat of the growth rate after industrial output grew 9.2 percent in June, its fastest pace since January.

"An obvious drop was seen in the industrial output growth for August," said Jiang Yuan, a senior analyst with the NBS, citing reasons ranging from weak external demand to tempered growth of auto and cell phone production.

China's August export growth came in at 9.4 percent, significantly lower than the 14.5-percent rise in July, pointing to dampened external demand and the complex situation of the world economy, according to Jiang.

Data on consumer goods such as cars and cell phones, which often posted double-digit growth in the past years, were also disappointing in August. Auto production grew only 3.1 percent, down sharply from 10.5 percent in July, while cell phone production retreated 2.3 percent.

Another drag was cooling investment. Saturday's data showed urban fixed asset investment in January-August grew at a slower pace of 16.5 percent and property investment growth moderated to 13.2 percent. The investment slowdown weighed on related sectors including cement, glass and home appliance production, according to Jiang.

Jiang also pointed to destocking pressure and a high comparative base last year.

Saturday's data came as China's leadership assured global CEOs that China can meet its major economic goals this year and policymakers will not be distracted by minor fluctuations.

Premier Li Keqiang downplayed the importance of some economic data from the past two months when delivering his keynote speech to the 2014 Summer Davos on Wednesday in Tianjin.

"The government will not be distracted by short-term fluctuations of individual indicators." Li said, referring to recent slower growth in power consumption and freight volume.

China has a GDP growth target of around 7.5 percent and a consumer price index (CPI) increase target of about 3.5 percent for 2014, with 10 million more urban jobs to keep the urban unemployment rate at a maximum of 4.6 percent.

In the first half of the year, the GDP expanded 7.4 percent with a slightly stronger second quarter, while the rise in CPI stayed at 2.3 percent.

Yet the leadership seemed more concerned with the resilience of the economy, strengthened in part by a steadily expanding job market and better economic structure.

In the first eight months, more than 9.7 million urban jobs were created, 100,000 more than during the same period last year, the premier noted in the speech.

The government also introduced a raft of targeted "mini-stimulus" measures this year to boost sectors such as agriculture, shantytown renovation and small businesses, refraining from a strong stimulus or relaxing monetary policy.

In the latest move, the NBS on Friday announced a broader accounting regime that aims to shift officials' obsession with GDP and place more weight on environmental and social development.

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