The Growing Problem With China's Unreliable Numbers (ft.com) 42
Chinese economist Gao Shanwen told a Washington panel in December that China's real GDP growth might be around 2% rather than the official figure near 5%. By January, Gao was no longer chief economist at SDIC Securities and went silent for almost a year.
As FT points out in a long piece, China does not publish quarterly GDP breakdowns showing consumption, investment and net exports. Every other major economy produces these figures.
The IMF in 2024 gave China a C grade for national accounts. The rating puts China on par with India and below Vietnam. Fixed asset investment data showed negative growth in 2025 for only the second time in decades. Property investment has fallen consistently since 2022. But official GDP investment data shows no signs of declining.
The National Bureau of Statistics stopped publishing sectoral breakdowns of fixed asset investment in 2018. It discontinued a price series in 2021 and a land sales series in 2023. Beijing has restricted researcher access rather than addressing longstanding questions about data quality. China says it disagrees with the IMF's C rating. The government argued its production-side GDP approach is appropriate.
Why does it matter? China is too large and too interconnected with the global economy for unreliable data to be a purely domestic issue. The lack of transparency creates problems for everyone trying to make decisions based on understanding China's economic trajectory. As Eswar Prasad, a professor at Cornell University and former IMF official, told FT: China is one of the two biggest economies in the world. "It would be nice to know what is really going on."
The IMF in 2024 gave China a C grade for national accounts. The rating puts China on par with India and below Vietnam. Fixed asset investment data showed negative growth in 2025 for only the second time in decades. Property investment has fallen consistently since 2022. But official GDP investment data shows no signs of declining.
The National Bureau of Statistics stopped publishing sectoral breakdowns of fixed asset investment in 2018. It discontinued a price series in 2021 and a land sales series in 2023. Beijing has restricted researcher access rather than addressing longstanding questions about data quality. China says it disagrees with the IMF's C rating. The government argued its production-side GDP approach is appropriate.
Why does it matter? China is too large and too interconnected with the global economy for unreliable data to be a purely domestic issue. The lack of transparency creates problems for everyone trying to make decisions based on understanding China's economic trajectory. As Eswar Prasad, a professor at Cornell University and former IMF official, told FT: China is one of the two biggest economies in the world. "It would be nice to know what is really going on."
The two largest economies on the planet (Score:2, Insightful)
All the pieces are here. We are in the middle of a industrial revolution with massive amounts of automation and technological unemployment without any significant new employment opportunities on the horizon. Seriously sit down and write out what the jobs are going to be after automation and ai and machine learning rip through the economy. You can't just go and make cars after the buggy whip factory shuts down w
Re: (Score:3, Interesting)
AI and modeling is making robotics useful across a wide range of disciplines, very suddenly. Where before you might need years and scores of prototyping attempts to get a functional restaurant dish washing robot today videos of humans doing the job can be fed to the AI, a prototype designed in the computer, and then thousands of actions and exceptions modeled in a few days before ever cutting a piece of metal.
When people who aren't smart enough to do anything more complex than wash dishes are laid off, whe
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Troll? Really mods? OK, whatever.
This guy expects Chinas collapse ... (Score:5, Informative)
... within this decade. And he's been doing that for a while [youtube.com]. And his reasoning sounds plausible.
Re:This guy expects Chinas collapse ... (Score:4, Interesting)
I watch a lot of PZ, but you need to take that guy with a grain of salt. Yes, he's generally correct about the overall trends, and he got famous by predicting the Russian invasion of Ukraine, but he's also prone to wild exaggerations, and often spouts incorrect details about countries or industries he talks about.
In the case of China, PZ's biggest argument that they're past peak and falling is demographic data. Unfortunately, just like their financial numbers, their demographic numbers are unreliable too. Most of this was systemic... instead of having a central institution do the census, China relies on data from provinces and adds them up. Unfortunately it also uses that data to determine transfer payments to provinces for things like school funding. So if you were governing a province and wanted more money for schools, you had an incentive to inflate the numbers, and this is what was happening for a long time. As China has been slowly releasing corrections to the data, massive numbers of people are just disappearing from the official counts. Like maybe one or two hundred million people.
What this means is that China's much further along the path to demographic decline than most other countries, and worse, they were actively trying to suppress birth rates with the one-child policy for a good portion of this timeframe. By the time they figured out what was going on, it was too late. You can't suddenly manufacture a bunch of 18 year-olds to fill your factories. And as a nation, they're very unfriendly to immigration, so that option is off the table too.
Now, China also has a leader who likes to shoot the messenger. Anyone under him who publishes data that Xi doesn't like finds himself on the outside, and unemployed. (Which is why we were all so aghast when Trump did the same thing with the jobs numbers.)
So yes, the reliable data we do have seems to indicate that China is in a lot of trouble. But don't take everything PZ says as gospel. He's often wrong.
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Cripes, anyone who had been paying attention for the last quarter of a century could have predicted the "invasion of Ukraine". How many "red lines" did NATO think it could cross before Russia finally felt forced to act?
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I wouldn't be surprised if Putin took that obviously empty talk from Biden (who was talking about it during Obama's administration) as an indication that NATO didn't have a re
I know you have to take Peter Zeihan ... (Score:2)
... with a metric ton of salt, but on the demographics of China and their impact he seems spot on. And let's be honest, there's not that much you can get wrong here. It's quite simple math.
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(Which is why we were all so aghast when Trump did the same thing with the jobs numbers.)
Not taking sides here, but in your stated case with U.S. Jobs numbers, the very person Trump got rid of was the one who negated their own numbers because they were incorrect. True, Trump didn't like the numbers, but to argue that they were reliable or even correct is not accurate.
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LOL Zeihan.. youtube specialist.
Re:This guy expects Chinas collapse ... (Score:5, Informative)
... within this decade. And he's been doing that for a while [youtube.com]. And his reasoning sounds plausible.
Before I even clicked on the link I was pretty sure it was going to be a Peter Zeihan video, and I was not wrong. A friend of mine once wrote "Peter Zeihan has predicted 20 of the last 3 international crises", and that's a pretty accurate summation of his videos. He's smart and knowledgeable, and therefore convincing; but there are things he misses, including "the mark" on a lot of occasions, and he skews pretty heavily toward alarmism.
Whenever I encounter a persuasive pundit on YouTube I look for contrary opinions and info. I doubly recommend that practice in Zeihan's case. His vids can be part of a balanced news meal, but skipping counter opinions will likely result in a "newstritive" deficiency.
Re: This guy expects Chinas collapse ... (Score:2, Insightful)
You don't listen to people like Zeihan to know the future, you listen so you're not surprised when it arrives. It's not meant to be 100% accurate. It's meant to highlight the dynamics of the global economy.
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Though the big concern has got to be what the CCP may do as it desperately tries to cling to power. When Argentina began to fall apart, they invaded the Falklands. China already wants to invade Taiwan. Argentina didn't have nukes.
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China is like the EU - perpetually on the verge of collapse, if you believe the "experts".
They do this not to hide bad numbers, to be prevent the kind of thing you see happening on Wall Street all the time. They don't want a huge speculative gambling market, they don't want people betting against their economy, and they don't want people making short term decisions based on quarterly data.
China Shills Assemble (Score:3)
It's your time to defend China's reputation!
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It's your time to defend China's reputation!
It isn't even desirable - never mind necessary - to worry about China's reputation when we have "unreliable numbers" much closer to home. [economist.com]
Re: China Shills Assemble (Score:2)
But because we have reliable number for a long period of time before that, we're still able to effectively use proxy measures from private industry to have a good sense of where we're at. With China, the numbers have been off for so long that analyses are inevitably harder to make with precision.
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Which is on its way to the President's desk, and he said he'll sign it. Passed with a veto-proof majority in the House.
All of which was unnecessary given he's had the power to release them all along.
Not a China problem (Score:2)
China (Score:2)
The land of facades.
China's numbers have always been fantasy (Score:2)
The same goes for much of the "data" driving their stock mark....er....casino.
Having lived there for years as an expat and seen entire sections of cities with many thousands of newly built flats that were vacant and stayed vacant, I think it's only a matter of time before that house of cards implodes.
The "nong min" don't take kindly to the apparatchiks that have been benefiting from the egregious corruption and self dealing. It's going to be ugly when it implodes.
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Re: China's numbers have always been fantasy (Score:2)
How can you take the official numbers seriously (Score:3)
unless you've been in a coma for the last 50 years? I mean, seriously, their entire economy has been a house of cards for at least that long.
Wishful thinking (Score:1)
These guys just hope they are true, but they aren't.
Because how else can their production boom be explained? That they suddenly appeared as the bigest car producer in the world, taking over markets?
And it doesn't happen only with cars.
fortunately (Score:1)
.... Their green energy data is flawless, because nobody would ever deliberately lie about that stuff!
Re: fortunately (Score:2)
It would really be a delight for a reporter to have one of those boxes that echoes someoneâ(TM)s words back at them a half second after they say them.
Ask a touchy question and then just hold it up and watch Trump go insane.