Page last updated at 10:14 GMT, Monday, 1 December 2008

China factory output down sharply

Chinese textile worker
There are growing signs that the global economic downturn is hitting China

China's manufacturing output fell sharply in November, just the latest sign that the global economic slowdown is impacting on its economy.

The official purchasing managers' index declined to 38.8 in November, from 44.6 in October, with any figure under 50 indicating a contraction.

The fall was caused by a sharp drop in new orders, especially from abroad.

China's President Hu Jintao has warned that the global financial crisis is hitting the country's competitiveness.

'Grim month'

"Another grim month for China manufacturing and the first in which the weakness in overseas demand overtook what, until now, has been mainly a domestic slowdown," said Eric Fishwick, head of economic research at CLSA.

The latest official figure from the China Federation of Logistics and Purchasing was the worst since the data was first published in 2004.

Government economist Zhang Ligun said the economy was now "slowing down at an accelerating rate".

The annual rate of Chinese economic growth has now slowed to 9%, with economists predicting it may fall to as low as 7% in 2009.

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