Manufacturing investment to remain resilient

Investment in infrastructure and manufacturing sectors is expected to remain resilient and help shore up the economy in the coming months, having registered robust expansion in the first quarter, officials and experts said on Monday.

Nevertheless, they pointed to risks of a drawn-out real estate slowdown and COVID-19 uncertainties weighing on investment activity, and called for more substantial policy support.

Their comments came after the National Bureau of Statistics said fixed-asset investment－excluding rural households－rose 9.3 percent year-on-year to 10.49 trillion yuan ($1.65 trillion) in the January-March period, up from 4.9 percent for full-year 2021 but down from 12.2 percent in the first two months of the year.

Experts said investment activity has largely held its own despite the resurgence in COVID-19 cases in March, thanks to buoyant investment in the manufacturing sector and the government's push to speed up infrastructure construction.

The NBS data released on Monday showed that the year-on-year growth in manufacturing investment sped up from last year's 13.5 percent to 15.6 percent in the first quarter, which experts attributed to the country's high export growth, policy support for manufacturers and the trend of industrial upgrading.

Investment in high-tech industries surged 27 percent year-on-year in the first quarter, led by sectors such as electronics and communications, medical equipment and information services, according to the bureau.

Meanwhile, infrastructure investment expanded 8.5 percent on a yearly basis in the first quarter, up from 0.4 percent for full-year 2021 and 8.1 percent in the January-February period, amid the country's efforts to beef up infrastructure investment at an early date this year.

"Investment is likely to play a bigger role in driving the economy," said Fu Linghui, an NBS spokesman, citing the growing momentum of emerging industries, upgrades of traditional industries and infrastructure project construction.

Li Qilin, chief economist at Shanghai-listed Hongta Securities, said proactive fiscal policy is expected to sustain robust expansion in infrastructure investment, a key buffer against rising economic headwinds.

Li also called for more policy support to help manufacturing investment maintain its fast growth, given the emerging downward pressure on exports and uncertainties caused by domestic COVID-19 resurgences.

Real estate development investment, however, might continue its downturn and weigh on economic growth as cooling home sales and financing difficulties are likely to make property developers turn more cautious in launching investment projects, Li added.

Investment in real estate development edged up 0.7 percent year-on-year in the first quarter, compared with 4.4 percent for full-year 2021 and 3.7 percent in the first two months, the NBS said.

Zhang Yue and Ouyang Shijia contributed to this story.