TAIPEI (Taiwan News) — Activity in China’s factories has contracted for the second month in a row, reports The BBC.
Statistics from the official Purchasing Managers Index (PMI) put China at 49.5 in January—up slightly from December’s 49.4 level, but still within the contraction zone.
PMI helps advise company decision makers and purchasing managers by indicating the economic health of a country’s manufacturing and service sectors. A PMI reading of under 50 represents an economic decline.
The BBC reports a slowdown across a plethora of industries in China. Some of the multinationals that recorded softer sales in December and January include industrial equipment giant Caterpillar, chipmaker Nvidia, and 3M, which produces over 55,000 items including Scotch Tape and Post-It Notes.
These companies join technology giant Apple, who began warning investors of revenue shortfall due to slow sales in China in early January. Chief Executive Tim Cook said China’s stagnating retail market problem has been exacerbated by the U.S.-China trade war.
As well as this, China has been encouraging both domestic production, through its Made in China 2025 strategic plan, and consumption—including certain company employers implementing a series of rewards and punishments for those (not) switching over to domestic brand mobile phones.
Officials from Beijing and Washington began another round of negotiations over the trade war on Wednesday. The deadline for Xi to make a deal is March 2, when Trump will raise tariffs on Chinese goods from 10 to 25 percent if no agreement is reached.