China's output grows fast despite flooding


China's economy is on track for growth of 7.5 percent this year, according to government analysts

BEIJING, China (Reuters) -- China said on Tuesday its industrial output rose 12.7 percent in August, sustaining a strong pace despite widespread flooding that had been expected to dent the economy slightly.

Industrial output from January to August rose 12 percent from the same period a year earlier to 1.97 trillion yuan, the State Statistical Bureau said in a statement. August's output was 263.4 billion yuan ($31.8 billion).

The growth was slightly lower than July's 12.8 percent rate. Economists have said heavy flooding in wide areas of the country last month could have affected many township factories and mines. The damage was pegged in the billions. (Full story)

China has set a target for factory output growth of nine percent this year in order to reach its official economic growth goal of seven percent.

So far, Chinese industry has been humming well above that pace but analysts say they are concerned about chronic overcapacity and production of shoddy goods.

China's economy grew eight percent in the second quarter and 7.8 percent in the first half.

Although the government has not revised its original seven percent target for this year, many government analysts say they now expect growth of at least 7.5 percent.

Five key industries

Five industries - automotive, telecommunications and electronics, textiles, chemicals, and metals - accounted for nearly half industrial output, the bureau said.

Thanks to a recent car-buying frenzy, the contribution of the automotive industry to overall growth for the first time outstripped that of the electronics industry, it said.

The steel industry grew at one of its fastest rates all year in August, with steel production rising more than 25 percent from a year earlier and output of steel products growing by more than 22 percent, the bureau said.

"Growth in metals industry output stepped up, increasing its contribution in spurring industrial output growth," it said.