The Curious Case of China’s GDP Figures

[Skull and Bones]

This is a thread and I am giving my opinion.

And how exactly is this creative criticism? It's been the exact same story for the past 20 years, with a few details changed each time.

According to them, we have been on the verge of collapse since at least the 1989 Tiananmen incident, though probably long before that as well.

But few points in the article is valid, don't you think so?

How can an estimation and calculation of a $ 8 trillion dollar economy take less than two weeks? Or a large economy (almost a trillion)of 32nd province went unnoticed until recently?

No one is questing growth, but the question is coming at the methods of it's accountability.

@Skull and Bones mate I request you to go easy on CD, he is the one with good reasoning and tolerance



Yes western media is some what biased and targets emerging economies which it feels threat to their hegemonic designs.

But I always feel some manipulation is going on in CCP calculations so I posted it here.

I don't take cheap shots at others, brother. If someone throws a question at me, i try to answer it, and prefer to stay quite if i don't know the answer.

GDP calculation in all developing countries are always fishy,even developed countries are no exceptions.See how Greece literally cooked the books and ended up bankrupt.For a country like China there will always be issue like this.But at the end of the day China’s economic growth cannot be denied, nor their ability to sustain growth over many more years.

Greece didn't cooked up accounts, they kept up borrowing to keep their stagnating economy from collapsing. And all developing countries have a large unaccounted shadow economy.

 

[Chinese-Dragon]

All GDP figures are estimations. Since of course it is impossible to measure it with perfect accuracy.

If you don't like the way the figures are complied, look at the raw numbers for each indicator.

If you don't like/trust the raw numbers, sit outside a Chinese factory and count the cars coming out.

If you don't trust that, then don't invest in China. Simple enough.

 

[illusion8]

Chinese growth figures have always been suspected by economists - but it doesn't take away the growth factor that is definitely happening in China.

 

[ChinaToday]

Chinese growth figures have always been suspected by economists - but it doesn't take away the growth factor that is definitely happening in China.

yeah you are right the actual figures of our economy is more like 11 trillions than 8 trillion take a look at this

The Chinese Have $1.5 Trillion In Hidden Income

Almost Rmb10 tn in hidden income, or 30% of GDP. Based on a creative survey technique focusing on the correlation between income and spending patterns, and with over 4,000 samples across 19 provinces in China, Prof. Wang estimates that the per-capita disposable income of urban Chinese households in 2008 should be Rmb32,154, 90% above the official data. Total hidden income could total Rmb9.3 tn, 30% of GDP, with about 63% of hidden income in the hands of the top 10% of urban households.

The Chinese Have $1.5 Trillion In Hidden Income - Forbes

Exactly the kind of quality posts i expect from you guys.

india behind china for atleast 40 years in everything and for you guys to mock china I wouldn't exactly call it smart is it?

 

[Azazel]

Greece didn't cooked up accounts, they kept up borrowing to keep their stagnating economy from collapsing. And all developing countries have a large unaccounted shadow economy.

Actually they did.There are many compelling evidence for this.They want to get in to the EU, and they lied about their debt and budget deficits.Chances are,they are still doing it today.

 

[illusion8]

yeah you are right the actual figures of our economy is more like 11 trillions than 8 trillion take a look at this

The Chinese Have $1.5 Trillion In Hidden Income

Almost Rmb10 tn in hidden income, or 30% of GDP. Based on a creative survey technique focusing on the correlation between income and spending patterns, and with over 4,000 samples across 19 provinces in China, Prof. Wang estimates that the per-capita disposable income of urban Chinese households in 2008 should be Rmb32,154, 90% above the official data. Total hidden income could total Rmb9.3 tn, 30% of GDP, with about 63% of hidden income in the hands of the top 10% of urban households.

The Chinese Have $1.5 Trillion In Hidden Income - Forbes

Developing countries and specially South Asian countries have a lot of hidden income in a parallel economy that accounts to roughly 50-60% of their declared figures. The only issue is the flight of these incomes out of the country and it' parking in safe havens or in other developed economies that offer incentives to bring in finance. - Nothing new.

 

[ChinaToday]

Actually they did.There are many compelling evidence for this.They want to get in to the EU, and they lied about their debt and budget deficits.Chances are,they are still doing it today.

exactly this has been a know fact to every one except skul and bones ofcouse but the funny thing is he called himself a quality POSTER HAHAHA

 

[ChinaToday]

Chinese growth figures have always been suspected by economists - but it doesn't take away the growth factor that is definitely happening in China.

Do you think we cooked up our accounts and then this

China denies it is world's biggest trader despite data showing it passed US last year

Read more: China denies it is world's biggest trader despite data showing it passed US last year | Fox News

 

[illusion8]

Do you think we cooked up our accounts and then this

China denies it is world's biggest trader despite data showing it passed US last year

Read more: China denies it is world's biggest trader despite data showing it passed US last year | Fox News

Use your 101 IQ and re read my post - I was agreeing with you there plus telling you that this so called parallel economy or hidden wealth is present in all developing countries - China is not exclusive. There is a rough estimate that corrupt Indians have stashed away 1.6 trillion dollars in tax havens.

 

[Skull and Bones]

india behind china for atleast 40 years in everything and for you guys to mock china I wouldn't exactly call it smart is it?

Sure Sir.

Chinese GDP was $1.9 trillion in 2004, which is where Indian GDP is now (approx), without any major industrial reform. Applying nursery class mathematics (2013-2004), by economy we're 9 years behind.

China's 2004 GDP ranks 6th in world economy


Coming to foreign reserve, Chinese foreign reserve was $287 billion in 2002, while Indian foreign reserve stands at $294 billion in 2013. Again applying Kindergarten mathematics, (2013-2002) 11 years.

China's foreign exchange reserves


If you got high IQ, prefer to show it in real terms. Don't shove all facts under the carpet like CCP. That's not conducive for the intelligence quotient factor.

 

[ChinaToday]

Use your 101 IQ and re read my post - I was agreeing with you there plus telling you that this so called parallel economy or hidden wealth is present in all developing countries - China is not exclusive. There is a rough estimate that corrupt Indians have stashed away 1.6 trillion dollars in tax havens.

you misunderstood me i just further proving my point with a useful link

 

[Chinese-Dragon]

Sure Sir.

Chinese GDP was $1.9 trillion in 2004, which is where Indian GDP is now (approx), without any major industrial reform. Applying nursery class mathematics (2013-2004), by economy we're 9 years behind.

This is wrong, because it assumes that India will grow as fast in the next decade as China did in the past decade.

For reference, in the past decade we grew extremely fast. For example 2007 we grew at 14.2%.

And here is a reference.

http://www.economist.com/blogs/dailychart/2011/10/comparing-india-and-china

Moreover, the chart does not necessarily imply that India in nine years' time will be as rich as China is today. That is because China grew faster in the last nine years than India is likely to grow over the next nine.

If you can't match our growth rates in the past decade, you can't repeat what we did in the past decade.

Finally, one dollar today is worth far less than one dollar was worth ten years ago. Due to inflation.

 

[muse]

Indian friends have an incredible appetite for anything that can suggest that China is a figment of others imagination, that it's all bluff, smoke and mirrors -- whom do they seek to persuade? others or themselves??

If China is all smoke and Mirrors, and lets grant that it is, will that somehow change reality in India?

 

[Skull and Bones]

This is wrong, because it assumes that India will grow as fast in the next decade as China did in they past decade.

For reference, in the past decade we grew extremely fast. For example 2007 we grew at 14.2%.

And here is a reference.

Comparing India and China: Chasing the dragon | The Economist



So growth rates are not the same, you can't just assume they will be.

Finally, one dollar today is worth far less than one dollar was worth ten years ago. Due to inflation.

Sure, i support that point. But all the growth in India has been without any major economic reform or any defined industrial policy.

And after reaching the middle income group, Chinese growth will settle at sustainable rate of 5.5-7%, and loosing the much lucrative charm of cheap labors for western manufacturing companies.

With well defined industrial policy and economic reforms, India can achieve decent growth rate for a coming decade. But then again, all depends on political willingness.

 

[illusion8]

you misunderstood me i just further proving my point with a useful link

There are a few points in the article that only a Chinese economist can corroborate with facts and those points are the methodology that's being used by China to gauge it's growth figures - according to the author the parameters used are being cooked up for e.g. the energy generation as a benchmark to calculate Growth - while he asserts that provinces give higher energy generation numbers to match their coal consumption to look good in the environment books.

A Chinese economist can either corroborate or prove it false and say that what China's presently doing is the right methodology - there's no denying that China's growing - and there's no point in us arguing on unrelated matters. If you are an economist and if you have the details to falsify the author's points than it would be worth the discussion - we cannot generalize here and say that the author has a bias - he has raised valid points - how true or false it is will depend on your answers.

Indian friends have an incredible appetite for anything that can suggest that China is a figment of others imagination, that it's all bluff, smoke and mirrors -- whom do they seek to persuade? others or themselves??

If China is all smoke and Mirrors, and lets grant that it is, will that somehow change reality in India?

@muse, it has nothing to do with us being Indian - though I won't deny some bias - but in all generality we do look up to China and know that we will be there at one point of time - albeit slowly - we like to learn what's happening there so that we are somewhat prepared for it when we get there.