The index fell to 48.1 in December from 51.8 in November, showed World Economics' survey of sales managers at over 2,300 companies conducted Dec. 1-16. The index was the lowest since the survey began.
"The survey suggests strongly that the growth rate of the Chinese economy has slowed quite dramatically, and may be heading for recession in 2023," said World Economics.
The world's second-biggest economy after the United States is facing a surge in COVID-19 infections following the abrupt relaxation of strict containment measures, hitting businesses and consumers alike, while a weakening global economy is hurting Chinese exports.