China's industrial firms enjoyed profits of 725.2 billion yuan (US$87.4 billion) during the first 11 months of this year, an increase of 44.6 per cent compared with a year ago, the National Bureau of Statistics said yesterday.

The profit growth, which was 1.4 percentage points lower than the first 10 months, is still much faster than the 20.6 per cent rise in 2002.

Profits made by State-owned industrial firms and firms in which the State is a majority stake-holder were 347.4 billion yuan (US$41.8 billion) during the period, a year-on-year increase of 49.7 per cent, the bureau said in a written statement.

Industrial enterprises handed in 649 billion yuan (US$78.2 billion) in taxes to the State, a year-on-year increase of 19.3 per cent.

During the first 11 months, sales income earned by industrial firms reached 12.46 trillion yuan (US$1.5 trillion), an increase of 27.7 per cent over the same period last year.

Net loss suffered by money-losing companies was 100.4 billion yuan (US$12.1 billion) during the period, a drop of 1.9 per cent compared with a year ago.

Bureau spokesman Yao Jingyuan said the industrial sector's good performance was partly due to the country's fast fixed asset investments.

They grew at a year-on-year 30.2 per cent to 3.46 trillion yuan (US$417.1 billion) during the first 11 months, the bureau said earlier.

That performance also attributed to the upgrade of domestic consumption, the adjustment of industry structure and the price changes on the international market, said Yao, who is also chief economist at the bureau.

He said profits made by a majority of the industrial sectors continued to grow during the January-November period.

Earnings of crude oil and natural gas producers rose 31.8 billion yuan (US$3.8 billion) during the 11 months compared with a year ago.

Profits of the transport sector, including cars, rose 28 billion yuan (US$3.4 billion), while earnings of ferrous metal smelters increased 28.9 billion yuan (US$3.5 billion), he said.

Profits of chemical raw material companies rose 17.4 billion yuan (US$2.1 billion), while earnings from electricity power producers increased 13.2 billion yuan (US$1.6 billion).

The five sectors accounted for 53.4 per cent of the increased profits for the whole industrial sector, Yao said.

Wang Zhao, a researcher with the State Council's Development Research Centre, said the accelerated profit growth suggests the Chinese economy has continued on a healthy development track.

China's gross domestic product grew 8.5 per cent during the first nine months of this year as compared with a year ago, the statistics bureau said earlier.

The higher economic growth rate was a result of the country's implementation of pro-active fiscal and sound monetary policies, he said.

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