| atest performance of China's machinery and | | | | Therefore, the NDRC report pointed out that with |
| equipment manufacturing industry trend showing a | | | | the increasing market demand, the equipment |
| boom, but generally traditional products is already | | | | manufacturing industry in 2007 to obtain a more |
| very fierce competition in future, have greater | | | | generous space for development, but the "structural |
| investment value of companies should be those with | | | | surplus" of supply and demand relationship will exist in |
| high technological content and high added value | | | | the longer term. The near future, although some |
| manufacturers. | | | | general growth in demand for traditional products, but |
| Recently, the National Development and Reform | | | | the competition is very intense; high technological |
| Commission Economic Operation Bureau released its | | | | content and high added value of major technical |
| latest report on machinery and equipment | | | | equipment demand will grow rapidly. |
| manufacturing industry. The report shows that in | | | | CITIC Securities analysts believe that China's future a |
| 2006 the first 10 months, the industry's main business | | | | large number of foreign engineering contracting and |
| income of 4.27 trillion yuan, an increase of 30.2%, an | | | | to enhance their competitive edge will promote the |
| increase of 9.2 percentage point increase; total | | | | export of domestically produced equipment, high |
| profits of 230 billion yuan, an increase of 41.7% over | | | | growth, domestic exports of equipment not only |
| the same period increased 39.6 percentage points . | | | | increases an export earnings, more importantly, the |
| The report concluded that China's machinery industry | | | | release of some domestic capacity to supply and |
| in 2007 there is still ample room for development. | | | | demand more balance, the industry cyclical |
| Export Growth Than Import | | | | fluctuations tend to weaken; In addition, the national |
| Development and Reform Commission Economic | | | | economy and technological upgrading of industrial |
| Operations Bureau report shows the first 11 months | | | | machinery and equipment industry will be 5 to 10 |
| of 2006, China's machinery industry total industrial | | | | years to bring the golden period of development. |
| output value 5 trillion yuan, up 29.4%, an increase of | | | | Orient Securities Analysis Report also believes that |
| an increase of 8.2 percentage points; the completion | | | | new projects will provide engineering machinery |
| of the industrial added value RMB1.26 trillion yuan, | | | | industry of high growth, import substitution of space |
| growth 21.3%, increased by 7 percentage points; | | | | to open opportunities for the highly sophisticated |
| cumulative production and marketing rate of 97.29%. | | | | CNC machine tools, railway equipment, the stimulation |
| Among the 95 types of industry the main products, | | | | of investment will also provide opportunities for |
| three quarters of the products achieved double digit | | | | development. |
| growth. Produced 6.66 million vehicles, up 26.1%, of | | | | Frustrated Raw Material Prices |
| which 3.56 million cars, an increase of 40.3%; power | | | | At present, the machinery industry investment in fast |
| generation equipment 109.23 million kilowatts, an | | | | growth, excess capacity gradually surfacing. 2006 1 |
| increase of 30.8%; metal cutting machine tool | | | | November, general equipment manufacturing industry, |
| 510,000 sets, an increase of 13.9%, numerical control | | | | electrical machinery and equipment manufacturing |
| machine tool 77000 units, an increase of 30.8% ; oil | | | | industry, special equipment manufacturing industry, |
| refining, petrochemical special equipment 34 million | | | | instrumentation, and cultural and office machinery |
| tons, up 59.9%. | | | | manufacturing fixed asset investment rose 55.6%, |
| In addition, the export growth is higher than imports, | | | | 52.2%, 40.6% and 35.1%. Moreover, as the |
| trade deficit gradually narrowed. In 2006 the first 10 | | | | machinery industry intensified market competition, |
| months, mechanical industrial exports 115.8 billion U.S. | | | | corporate profit margins narrow, multi industry sales |
| dollars, up 36.8%; imports of 115.9 billion U.S. dollars, | | | | are generally lower than the level of revenue growth. |
| an increase of 21%; total trade deficit of only 1.3 | | | | Development and Reform Commission in 2007 |
| billion U.S. dollars, over the same period of 2005 to | | | | development of the industry's analysis indicates that |
| reduce 11 billion U.S. dollars, imports and exports | | | | excess capacity, industry structure adjustment will be |
| basically balanced. | | | | part of the market demand for machinery products |
| By a Large Space with High Technological Content | | | | have a certain impact; particularly in the upstream |
| As the state's policy to revitalize the equipment | | | | energy and raw material prices and rising |
| manufacturing industry step by step, and equipment | | | | transportation costs will directly affect the mechanical |
| manufacturing industry to be focused support. | | | | industry economic benefits, such as copper, |
| However, as China's equipment manufacturing | | | | aluminum, high quality specialty steels and other raw |
| industry in a number of areas where technical level is | | | | material costs to run the enterprise. In addition, |
| not high, a number of major construction projects | | | | international trade protectionism, the macro control |
| and equipment will still have to rely on foreign | | | | so that both fixed asset investment growth will slow |
| imports, thereby accelerating technological innovation | | | | down the development of machine building industry |
| and equipment manufacturing industry made an | | | | has brought a certain extent. |
| urgent requirement to upgrade the structure. | | | | |