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Hard times for Chinese manufacturers

A final factories reading for April's HSBC/Markit Purchasing Managers' Index falling to 48.9 - the slowest in a year.
The powerhouse fueling China's economy slowing to a crawl.
The private survey comes off the back of official data released Friday showing a stall at 50.1, the same reading as March.
Weak domestic demand dragging on the once-mighty manufacturing sector - highlighting the slowdown in the country's overall economy after disappointing first quarter growth figures.
Paul Schulte of Schulte Research:
(SOUNDBITE) (English) CHAIRMAN & CEO, SCHULTE RESEARCH, PAUL SCHULTE, SAYING:
"Well I think China's manufacturing sector is undergoing a profound change right now. And it's almost a requisite for China, like every other economy and government in the world, to change how it's counting GDP. China is turning into a service economy, into a knowledge economy. How many tons of steel does Alibaba use? None. How much steel and cement does Tencent use? Answer, virtually none."
With the expanding service sector, many economists are optimistic but still calling for greater support from policymakers.
The central bank has already cut interest rates and banks' reserve requirement ratios twice in the past six months.
And recently the leadership vowed to reduce import duties and taxes on consumer goods to spur spending.
But these measures, say analysts, may still not be enough to keep the world's second largest economy on target.

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