China’s Industrial Profits Slump Deepens on Soft Demand, High Costs

An employee works at a manufacturing plant of Sany Heavy Industry Co. in Changsha, Hunan province, China, on Oct.19, 2019. Thomas Peter/Reuters

BEIJING—The slump in Chinese industrial firms’ profits deepened in the first two months of 2023, weighed by lackluster demand and stubbornly high costs as China struggled to fully shake the long-term effects of COVID-19.

The sharp 22.9 percent contraction followed a 4.0 percent fall in industrial profits for the whole of 2022, data from the National Bureau of Statistics (NBS) showed on Monday, pointing to a downbeat start to the year for factories at large.