China's non-manufacturing sector saw rapid expansion in August, with the service industry's prosperity level has rebounded significantly, according to data released by the National Bureau of Statistics and China Federation of Logistics and Purchasing on Sunday.
The Business Activity Index of China's non-manufacturing industry stood at 50.3 percent in August, up 0.2 percentage points from previous month, maintaining above 50 percent for multiple consecutive months, showing a steady growth of the country's non-manufacturing industry.
Among which, the business activity index of the service industry was 50.5 percent, up 0.5 percentage points from the previous month, reaching a high for the year.
"Driven by summer holiday consumption and supported by the policies of promoting large-scale equipment upgrades and consumer goods trade-ins, various consumer-related sector indices have maintained an expansionary trend," said He Hui, vice president of China Federation of Logistics and Purchasing.
Specifically, the business activity indices for capital market services, railway transport, air transport, telecommunications, radio and television, and satellite transmission services all remained in the high prosperity range of above 60 percent, indicating rapid growth in total business volume, according to the data.
The civil engineering construction industry continued to stay in the expansion zone, demonstrating that infrastructure-related activities maintained a relatively strong growth momentum, the data showed.
China's non-manufacturing sector sees rapid expansion in August
China has announced a stricter steel capacity swap plan to curb overcapacity and stabilize supply and demand, with the toughest measures since the swap system was established in 2014
Under the new plan, all new iron- and steel-making projects nationwide must follow a 1.5:1 nationwide replacement ratio, meaning that at least 1.5 metric tons of old steel capacity needs to exit to build one ton of new capacity. Projects involving substantive mergers and reorganizations may apply a 1.25:1 ratio. Regional differences have been scrapped, as a unified national standard is now in place.
The 2026 rules, issued by the Ministry of Industry and Information Technology, raise replacement ratios and restrict capacity transfer between companies to accelerate the exit of inefficient production capacity. The policy aims to shut down outdated, high-energy consuming, high-pollution and low-profit smelting lines, optimize industrial layout, and encourage mergers to boost industry concentration.
"The replacement ratio has been raised to 1.5:1 across the country. Regardless of the province, adding every ton of new capacity requires the exit of 1.5 tons of old steel capacity. The new policy eliminates the differentiated ratios under the previous rules, marking the reduction effort unprecedented in intensity," said Zhang Longqiang, president of the China Metallurgical Information and Standardization Institute.
Implementation of the replacement plan is valid for only 24 months, meaning projects must break ground within two years after they are approved, or they will risk cancellation -- a move aimed at curbing speculative hoarding of capacity, Zhang said.
The rules also tighten oversight of special processes, capping induction furnaces used for stainless steel production to prevent disguised capacity expansion.
The rules stipulate that after two years, companies will no longer be able to trade capacity quotas directly, and will only be able to obtain them through substantive mergers and restructuring.
China releases stricter steel capacity swap plan to curb overcapacity
