THE OFFICIAL RECKONING of economic expansion last year is 6.7%. As ever, that falls neatly into the target range of 6.5-7% GDP growth.
The cup half full view of the world sees that as meaning China’s managed growth slowdown is on track; the cup half empty view highlights that that is the slowest annual growth rate in more than a quarter century.
There are many who believe China’s economy is growing at nothing like the rate the published numbers say. This Bystander has never been in the camp of those who say they official numbers are so awry that growth now could be as low as 4%. Equally, we don’t doubt that there has been ‘smoothing’ of the numbers over the years.
However, for years, summing the provincial economies never exactly seems to match the size of the national economy as it more or less should, even given both data sets use different systems of data collection.
But now the sceptics can point to the confession of officials from Liaoning that the provincial government had faked its economic data, including fiscal revenue, between 2011 and 2014.
It was Liaoning, loyal readers will recall, even before that, in 2007, where the province’s then Party boss, Premier Li Keqiang, famously said he looked at economic indicators such as railway cargo and electricity generation because he did not trust the province’s official data.
That officials plump their numbers to boost their promotion prospects will come as a surprise to few. GDP numbers are anyway a flawed measure of an economy, and particularly as an economy shifts from manufacturing to services; a country can boost the value of its GDP just by having its lawyers raise their fees — not many people’s idea of economic growth.