CHINA’S DATA

CHINA'S DATA: WHICH WAY TO CUT IT?

Tom Orlick (WSJ)

The Australian, October 19, 2012

CHINA'S next generation of leaders will take the stage at the Party Congress, scheduled to start November 8, against a background of intensifying worries about the world's second largest economy.

Growth in China's gross domestic product has slowed to 7.4 per cent year-over-year in the third quarter, down from 7.6 per cent in the second. Some analysts believe even those numbers are exaggerated.

The man likely to be appointed China's premier, Li Keqiang, may also be secretly pessimistic about where growth is headed. In remarks to US Ambassador Clark Randt in 2007, released as part of the WikiLeaks scandal,

Mr Li -- then chief of Liaoning province in China's northeast -- said China's GDP data was 'man made'.

Provincial GDP data -- which Mr Li probably had in mind -- is particularly unreliable, with all of China's provinces consistently reporting growth faster than the national rate. To keep track of growth in Liaoning, Mr Li preferred to watch electricity consumption, railway freight, and bank lending.

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