BEIJING - China's ongoing supply-side structural reform is creating positive effects for economic growth, said a senior official on Tuesday.

Thanks to supply-side structural reform, the interaction of supply and demand in markets has improved significantly in the first six months, said Yan Pengcheng, spokesperson with the National Development and Reform Commission (NDRC) at a press conference on Tuesday.

In the first half of the year, the efficiencies of industrial enterprises increased rapidly, said Yan.

Profits of large industrial enterprises increased 22.7 percent year on year in the first five months, with particularly robust growth in May of 16.7 percent, according to Yan.

The official manufacturing PMI rose to 51.7 in June, accelerating from 51.2 in May, marking a three-month high. June's official non-manufacturing PMI also improved for the second month in a row to 54.9, from 54.5 in May, evidence of a better economic structure.

China has been trying to shift its economy toward a growth model that draws strength from consumption, services, and innovation.

The nationwide overcapacity reduction campaign has helped improve the performance of major industries, with impressive progress in the steel and coal sectors, Yan said.

During the first half, substandard steel production capacity was removed and the newly increased capacity was strictly controlled. About 111 million tonnes of outdated capacity was forced out of the market, completing 74 percent of the annual target.

While excessive capacity is eliminated, new growth drivers are gaining momentum. Consumption and services, together with innovation-driven new economic sectors, are playing a larger role in the economy, according to official data.

In the first half, the contribution of final consumption to GDP growth stood at 63.4 percent, slightly down from 64.6 percent for 2016. About 2.9 million new companies were established nationwide, up 11.1 percent from a year earlier.