China's industrial sector, which showed remarkable resilience during the COVID-19 epidemic, will normalize and return to the pre-outbreak levels during the second half of the year, experts said on July 16.

Industrial output, a key gauge of industrial activity in the country, rose by 4.4 percent year-on-year in the second quarter of the year, compared with the 8.4-percent plunge in the first quarter due to the novel coronavirus epidemic in China, the National Bureau of Statistics said on July 16.  

Industrial output growth rose to 4.8 percent year-on-year in June, compared with 4.4 percent in May, marking the third consecutive month that the barometer has remained in the positive territory since the epidemic, thanks to the effective epidemic containment and business resumption measures, said the NBS.

Buoyed by the brisk recovery in industrial production, the contraction in China's GDP narrowed from 6.8 percent year-on-year for the first quarter to 1.6 percent for the first half of the year. Industrial output contracted by 1.3 percent over the same period.

Liu Aihua, a spokeswoman for the NBS, said the improved economic conditions are an affirmation of the strong resilience and potential of the Chinese economy.

The recovery in production has outpaced demand, said Liu. Production growth in the industrial and services sectors has turned positive in the second quarter, while demand-side indicators like retail sales and fixed-asset investment have sustained the contraction.

China has also stepped up efforts to expand domestic demand, so as to help smoothen the interaction between production and demand and bring the economy back to normal, Liu said.

Looking ahead, analysts said the growth in industrial output may return to the level before the epidemic of about 5 percent to 6 percent on a yearly basis in the second half of the year. Industrial output saw a 5.7-percent growth in 2019.

"What empowers the future acceleration in industrial production will mainly be the recovery in demand, especially the ramped-up infrastructure investment driven by fiscal stimulus and the burgeoning high-tech sectors amid economic restructuring," said Wu Chaoming, deputy dean of the Chasing Institute under the aegis of Chasing Securities.

Liu Xuezhi, a senior researcher at the Financial Research Center of Bank of Communications, said further containment of the epidemic and stepped-up macro policy support will also help sustain the recovery in industrial output, which will in turn create more job positions.

Wu, however, noted that the impaired corporate probability could restrict the recovery in demand when it comes to manufacturing investment and household consumption, limiting the room for future pickup in industrial production.