The latest statistics from the newly established Ministry of Industry and Information revealed that the country's electronic and information industry increased 18.6 percent in terms of gross product in the first quarter this year, 10 percentage points behind the national average for industry growth, the official China Securities Journal reported yesterday.
State-owned enterprises and those with annual sales of over two million yuan in the electronic and information industry realized a total of 1.06 trillion yuan ($151.65 billion) in output value in the first three months of 2008, up 18.6 percent from the same period of last year. The total sales revenue saw a 19 percent year-on-year increase, and the software industry gained 139 billion yuan from sales, up 28.7 percent.
It is a continuing trend as the electronic and information industry began to cool down in 2007. Gao Sumei, assistant inspector at the Ministry of Industry and Information, said it is because the industry has begun a period of structural adjustment following years of sizzling growth.
"Some conventional markets like home theater, DVD and CRT television keep shrinking, and the flat panel TV industry has yet to drive the market despite eye-catching developments," said Gao.
Meanwhile, the investment environment is improving among China's neighbors such as Vietnam and India, which drew more foreign investment from China, Gao analyzed.
The American and European markets are major destinations for China's exported electronic products. The industry's overall export growth rate dropped eight percent, dragged down by a drop of 24 percent in export growth to the United States, a drop of 44 percent to the Netherlands, and a drop of 28 percent to Britain.
"Slowdown of the American and the European economies and soaring domestic production costs also more or less stalls the pace of China's electronic industry. A number of medium and small enterprises around the Pearl River Delta have closed," said Gao.
Statistics show that investment in the electronic and information industry also cooled down in the first quarter. Fixed asset investments in projects of over five million yuan totaled 50.79 billion yuan during this period, up 22.7 percent year on year, 5.2 percentage points lower than the same period in 2007 and 4.1 percentage points lower than the national average growth.
Foreign investment in the sector totaled 46.9 billion yuan during this period, a drop of 2.6 percent year on year.
