China's industrial output growth rose 3.2 percentage points in June compared with May, reversing the slowdown that took place in April and May as a result of the SARS outbreak, the National Bureau of Statistics said Thursday.

Industrial output amounted to 363.6 billion yuan (US$43.8 billion) in June, up 16.9 per cent compared with June last year, the bureau said.

Last month's industrial output growth was faster than May's 13.7 per cent and April's 14.9 per cent.

Growth was 16.9 per cent in March and 19.8 per cent in February.

For the first six months of this year, industrial output rose a year-on-year 16.2 per cent to 1.84 trillion yuan (US$221.6 billion), the bureau said.

Yao Jingyuan, the bureau's chief economist, said most industrial sectors -- including beverages, petroleum processing and clothing, which were severely hit by severe acute respiratory syndrome -- began to gain momentum in June.

The growth in beverage production last month was 10.7 percentage points higher than in May, while that of clothing production was 6.6 percentage points faster than in May.

The growth in petroleum processing was 8.7 percentage points higher than the previous month.

In June, exports handled by the industrial sector were worth 228.5 billion yuan (US$27.5 billion), a year-on-year increase of 29.6 per cent.

The growth rate was 3.6 percentage points faster than the previous month, the bureau said.

Wang Zhao, a researcher with the State Council's Development Research Centre, said the pick-up in industrial production suggests the SARS impact was temporary.

"Production will continue to pick up in the coming months,'' he said.

The SARS epidemic would not have a large negative impact on the industrial sector, which contributed more than 50 per cent to the country's gross domestic product, Wang said.

The disease also would not have a large negative impact on investment, although it would have some effect on domestic spending, especially the tourism and catering industry, he said.

The robust fixed-asset investment expected this year will benefit heavy industries such as cement and steel, Wang added.

"The impact of SARS on the whole economy will be less than 1 percentage point,'' he predicted.

Yao Jingyuan said the Chinese economy is expected to grow by between 8.3 per cent and 8.5 per cent during the first half of this year compared to the same period last year.

During the first quarter of this year, the economy grew by 9.9 per cent year-on-year.

According to the latest report on the issue released by the Chinese Academy of Social Sciences, China's economy will grow by 8 per cent this year.

The report said the influence of SARS on China's socio-economic development is minor compared with the impact of the Asian financial crisis in 1997.

The economic effects of the virus will be easier to overcome than the Asian meltdown or the September 11, 2001 terrorist attacks in the United States, the report said.

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