China’s factories are almost fully back to work.

A battery production line at a factory in Huaibei, China, on Monday.Credit...Agence France-Presse — Getty Images

Two months after China brought its economy to a near halt to contain the coronavirus, the country’s mighty industrial machine is showing signs of renewed life, according to official sources.

A measure of factory activity released on Tuesday showed a rebound in March, China’s National Bureau of Statistics said. The organization, which surveys purchasing managers at Chinese factories, said activity rebounded to 52 on its closely watched index, from 35.7 in February.

A number above 50 on the index indicates growing activity, though the figure could overstate the improvement. It does not show to what degree factories have resumed production, meaning those that have opened could still be operating well below capacity.

China’s government has taken a series of top-down measures to get the world’s No. 2 economy humming again. As the number of new infections reported each day has fallen, local officials have become more confident about allowing people to return to work.

But even if factories and workplaces are back in business, that does not mean the economy is entirely back on its feet. In the epidemic’s wake, cash-strapped families may be reluctant to spend. Businesses fear that their partners and suppliers might default on payments for goods and services. Demand for Chinese exports may be weak as the epidemic continues to worsen in many countries around the world.

Nationwide, major industrial enterprises are operating at an average of 98.6 percent of capacity, said Xin Guobin, China’s vice minister of industry and information technology, at a news briefing on Monday. And nearly 90 percent of employees at these businesses are back at work.

Reference: NY Times