China’s Bureau of National Statistics is today set to release April’s purchasing managers’ index (PMI) data, a key indicator of the health of the country’s manufacturing sector.
After February’s record low of 35.7 and a jump in the March index to 52, April’s PMI is expected to fall to 50 due to the global trade slowdown caused by the COVID-19 pandemic. A reading above the 50-point mark indicates an expansion in activity.
The long-term effect of the pandemic is likely to see Chinese manufacturing expand and its economic influence globally greatly increase, especially in Asia. With the latest data showing that some 84% of Chinese mid-sized and small businesses have already reopened, China’s economy is also expected to grow 1.2% in the year ahead.
Combined with quickly solidifying plans for the China-backed Regional Comprehensive Economic Partnership (the rival trade deal to the Trans-Pacific Partnership), Beijing is poised to increase its economic influence in the front of international trade.
As COVID-19 shutdowns subside and economies begin rebuilding, demand for Chinese manufactured goods such as electrical machinery, clothing and automobile parts, and Belt & Road Initiative Construction Projects will likely skyrocket, boosting especially the long-term outlooks for Chinese construction giants.