China’s Economic Numbers Once Again Have the Skeptics Suspicious

Jan 18, 2022

https://liquidity-provider.com/app/uploads/2022/01/dizajn-bez-nazvaniya-2022-01-19t175842.771.png

China's economic figures are not especially well-known for their trustworthiness or transparency. From broad economic growth to more precise indicators such as employment, many experts — particularly Western economists — have long expressed reservations about Beijing's estimates.

A lead author Frank Zhang wrote that in a 2020 Yale research conducted in partnership with China's elite Fudan University compared GDP data to the final figures supplied by local officials, concluding that "the evidence is extremely apparent that the statistics have been falsified."

As a result, it's unsurprising that many greeted Monday's preliminary release of economic figures for 2021 with suspicion.

China's National Bureau of Statistics (NBS) reported that the GDP increased at an annual rate of 8.1 percent in 2021. That looks incredibly robust on the surface — Goldman Sachs Group's current projection for US growth in 2021 is 3.8 percent. China's figure is based on a very low baseline from 2020 when the country's economy was afflicted by the coronavirus and officially grew at 2.2 percent.

China closed last year with robust exports and factory output, with value-added industrial output up 4.3 percent year on year in December, but with lackluster consumption, with retail sales increasing only 1.7 percent.

Whether the baseline is low or not, 8.1 percent is the strongest performance in a decade for the Chinese economy.

"I've been poring over China's data to determine why the quarterly change in GDP was revised significantly higher in the third quarter and estimated at an extraordinary 1.6 percent — nearly 6.5 percent annualized — in the final quarter," said George Magnus, an associate at the University of Oxford's China Centre.

"It defies belief that this depicts an economy in which the property sector elephant began contracting, consumption fell, and Covid-related shutdowns began" at year's end, he told Barron's on Tuesday.

Indeed, China's real estate industry contracted nearly twice as rapidly as it did the previous quarter, falling 2.9 percent following a 1.6 percent decline in the third quarter. According to official figures, this was also the first consecutive quarterly decline in 13 years.

This is particularly painful for a country like China, where the property industry is expected to account for a stunning 30% of total GDP.

For example, many analysts believe that if the already-difficult real estate market collapses completely, the impact on total GDP would be severe. "A 20% decline in real estate activity," Harvard economist Kenneth Rogoff previously told Barron's, "Could result in a 5-10% decline in GDP." Despite his unyielding skepticism, Magnus presented several explanations for the supposedly conflicting evidence.

"One is the contrast between sluggish spending and a poor sector of the estate on the one hand and more robust production and exports on the other," he explained. "The second is that both areas rebounded after the negative impact of power outages and increased costs in the late summer and early fall subsided in their sector."

Still, it would be astonishing if the economy expanded at a 6.5 percent annualized pace in the fourth quarter of 2021, he added. "I do not believe that this really represents what is happening in China and that the government's rhetoric in this case — supply shocks, demand contraction, and less strong expectations — is for once more true than the statistics imply," he added.

China faced "many tests of a dangerous and complicated worldwide environment and occasional pandemic breakouts at home," the NBS stated in an official statement accompanying the statistics release.

In a tweet Monday, Magnus mentioned five governmental changes that appear dubious in light of China's shockingly good official results.

"Why the frenzy of rate cuts, RRR reductions, and increased infrastructure spending?" he wrote.

Nonetheless, not all external observers viewed the figures suspiciously. Michael Pettis, a finance professor at Peking University and a frequent critic of Beijing's policies and lack of openness, forecast somewhat worse figures for the year — around 7.8%. However, he saw few abnormalities as the year drew to a conclusion.

"There will always be complaints of the NBS data's openness, but I have no reason to believe the Q4 data was wrong," he told Barron's.

"It would have been really beneficial if they had revealed the quarter-on-quarter increase rate, which they often do but did not this time, which may have contributed to people's suspicion," he added.

Subscribe Our Newsletter

These Closed-End Funds Are on Sale for the Holidays
These Closed-End Funds Are on Sale for the Holidays

That is most certainly not the situation in shops, where supply-chain concerns in 2021 have made Christmas markdowns scarce. However, in a rather obscure financial industry sector known as closed-end funds, some substantial discounts have surfaced.

Stocks
Elon Musk Keeps Fans Guessing by Tweeting Mysterious Chinese Poem
Elon Musk Keeps Fans Guessing by Tweeting Mysterious Chinese Poem

Elon Musk is notorious for his cryptic tweets that set the internet on fire. He's now doing it in a different language. On Monday night, Tesla (TSLA) and SpaceX CEO Elon Musk tweeted an old Chinese poem.

Companies
Tamta

What Is ChatGPT, And How Can You Use It?
Artificial Intelligence (AI) has been gradually waving into our daily lives for ages. For instance, Gmail's helpful phrase suggestions or our smartphones' autocorrect features are examples of AI work. However, AI's integration into our lives has never been as profound as today. A major reason for the increasing hype is the introduction of ChatGPT.

discover
Top 5 Most Reliable KYC Technology Providers

Constantine

Top 5 Most Reliable KYC Technology Providers

The development of trade in the financial sector has contributed to the creation of numerous financial markets that offer incredible opportunities for enrichment.

Crypto Exchange Business

Contact Us

Contact the Liquidity Provider
for any questions and advertising inquiries b2broker

    Please fill out this contact form to get in touch with us

    / 3000

    By clicking “Get in touch” button, you agree to the privacy policy

    Successful!
    Thank you for your request.
    We will contact you shortly.
    Close

    Alexander

    How Strong is The US Economy Today?

    How Strong is The US Economy Today?

    Alexander

    How Do Crypto Liquidity Pools Work in 2023-2024?

    How Do Crypto Liquidity Pools Work

    Alexander

    What Is The Wheel Strategy in Trading?

    What Is The Wheel Strategy in Trading?

    Alexander

    How to Choose a Forex Liquidity Provider in 2023?

    How to Choose a Forex Liquidity Provider in 2023?

    Alexander

    5 Best AI ETFs for 2023-2024

    5 Best AI ETFs

    Alexander

    What Is an Investment Priorities Plan?

    Investment Priorities Plan - Definition

    Alexander

    What is a Token Maker? – Creating Your Own Crypto Token Without Coding Skills

    What is a Token Maker? – Creating Your Own Crypto Token Without Coding Skills

    Alexander

    How Many Days a Year the Stock Market Is Up? – An Investor’s Guide to Long-Term Success

    How Many Days a Year the Stock Market Is Up?

    Alexander

    Invest $100 and Make $1,000 a Day: Best Strategies to Grow Your Money

    Invest $100 and Make $1,000 a Day: Best Strategies to Grow Your Money

    Alexander

    Is Real Estate Investment Trusts a Good Career Path? — Opportunities in 2023

    Is Real Estate Investment Trusts a Good Career Path?

    Alexander

    Is Day Trading Gambling? Most Likely Yes

    Is Day Trading Gambling? Most Likely Yes

    Alexander

    Where to Exchange Currency Without Paying a High Fee — Planning Your Travel Beforehand

    Where to Exchange Currency Without a High Fee

    Alexander

    Is Infinite Banking a Scam? Unveiling the Truth Behind the Concept

    Is Infinite Banking a Scam? The Truth Behind the Concept

    Alexander

    The Dollar Milkshake Theory: Could the US Dollar Become Even Stronger?

    The Dollar Milkshake Theory: Could the US Dollar Become Even Stronger?

    Alexander

    Why “Skip the Latte” is Poor Financial Advice

    Why "Skip the Latte" And "Cancel Netflix" Is Bad

    Alexander

    Is Now a Good Time to Invest? Exploring Investment Opportunities in 2023

    Exploring Investment Opportunities in 2023.

    Alexander

    Best Bitcoin Wallets in 2023: Comparing Features, Security, and Usability

    Best Bitcoin Wallets in 2023

    Alexander

    Top Rising NFT Artists to Watch Out for in 2023 And Beyond

    Top Rising NFT Artists to Watch Out for in 2023

    Alexander

    Insuring Your Future: What Type of Insurance to Buy?

    Insuring Your Future: What Type of Insurance to Buy

    Alexander

    Is IUL a Good Investment Strategy? — A Guide for Beginner Investors

    Is IUL a Good Investment Strategy? — A Guide for Beginner Investors

    Alexander

    Are Crypto Wallets Safe? — Tips to Ensure Maximum Protection of Your Digital Assets.

    Are Crypto Wallets Safe? — Tips to Ensure Maximum Protection

    Alexander

    Roth IRA Guide: What It Is and What You Need to Know.

    Roth IRA Guide: What It Is and What You Need to Know

    Alexander

    From Gold to Index Funds and Crypto: Where to Invest in 2023 for Long Term?

    From Gold to Index Funds and Crypto: Where to Invest in 2023

    Alexander

    Understanding Algorithmic Trading: A Guide for Beginners

    Understanding Algorithmic Trading: A Guide
    Latest News - Liquidity Provider: Business & FinTech Media
    • News
      • Stock Market Forecast
      • Stocks
      • Banks and Finance
      • Companies
      • Crypto
      • Forex
      • AI
      • Technology
      • DeFi
      • NFT
    • Articles
      • Crypto Payments
      • Trading
      • Crypto Exchange Business
      • Forex Business
      • Fintech
      • Liquidity
      • FinTech Awards
      • Blockchain
      • Investing
      • NFT
      • DeFi
    • More
      • Videos
      • Liquidity Providers List
      • Crypto Payment Providers
    [email protected]

    © 2023 Liquidity Provider. All Rights Reserved

    Privacy Policy Cookie Policy
    This site is registered on wpml.org as a development site.