China Economy Forum

[ahojunk]

ChemChina, Sinochem in talks on possible $100 billion merger: sources
By Chen Aizhu | BEIJING, Reuters
| Fri Oct 14, 2016 | 10:48am EDT

Chinese state-owned chemical companies Sinochem Group and ChemChina are in discussions about a possible merger to create a chemicals, fertilizer and oil giant with almost $100 billion in annual revenue, three sources familiar with the matter said.

The deal has been proposed by China's central government as part of its efforts to slash the number of state-owned companies and create larger, more competitive global industry players, said the sources.

The sources asked not to be identified because they were not authorized to speak publicly about the matter. Top management of the two firms held a meeting earlier this week to discuss a potential merger, said one source directly briefed on the matter.

"The government has given the mandate to let Sinochem lead in this potential merger with ChemChina," said the source.

A second source familiar with the matter said both firms have started due diligence work looking into each other's financial details and business segments.

When asked about a potential merger, a ChemChina spokesperson said: "There is no such thing."

A Sinochem spokesman said he was not aware of the discussions. China's State-owned Assets Supervision and Administration Commission (SASAC), which oversees state-owned enterprises, did not comment when asked about the talks.

Shares in the companies' listed subsidiaries jumped on the news, with Sinochem International up 10 percent for its biggest one-day rally in a year and Sinofert on track for its best daily gain since December.

While still at an early stage, the talks come as China National Chemicals Corp, as ChemChina is officially known, finalizes a $43 billion takeover of Swiss pesticides and seed group Syngenta. That deal would be China's largest-ever foreign investment.

In early European trading, Syngenta shares were down about 2 percent at their lowest in almost two months.

Syngenta declined to comment on the news.

European Competition Commissioner Margrethe Vestager would not comment on any potential issues arising from the deal, were China to create a domestic chemicals, fertilizer and oil giant.

"It's very early days," she told reporters on Friday.

The European Union is expected to rule on the deal by Oct. 28.


STRONGER, LARGER

It was not clear why the discussions were happening before the ChemChina-Syngenta deal had been finalised, or whether it would create further problems with anti-trust regulators around the world which have been looking at that deal.

Beijing may have initiated the talks to create a stronger, larger player to make it easier to absorb a world-class company like Syngenta, said the source directly briefed on the matter.

Backing from Sinochem might help ChemChina finance its Syngenta deal on more favorable terms, the source said.

ChemChina faces a $3 billion break fee if its Syngenta deal does not proceed.

If approved, the ChemChina-Sinochem merger would be among the largest between two Chinese state-owned enterprises, following similar marriages that created shipping giant China Cosco Shipping Corp, train maker CNR-CSR and more recently, the tie-up between Baosteel Group and Wuhan Steel.

Combining the two companies, which make everything from refined oil products to latex gloves and insecticides, would propel it into the top echelons of the competitive global chemicals, fertilizer and oil industries.

Based on 2015 annual reports, revenues of the combined group would comfortably eclipse Germany's BASF, the world's largest maker of industrial chemicals by sales.

It would be a major global chemical giant and challenge domestic rivals Sinopec, PetroChina and CNOOC, said Michal Meidan, London-based China analyst with Energy Aspects.

"It really does align nicely the government's priority to reduce the number of SOEs (state-owned enterprises)," Meidan said.


XI'S PUSH

A merger would fit in with President Xi Jinping's years-long push to shrink the number of centrally-controlled state-owned enterprises, which number more than 100.

In Sinochem's case, it is larger than ChemChina, but it needs a partner in the long term if it wants to expand in the global market and extend beyond roots that go back almost 70 years in oil and chemical trading, experts who know the companies said.

Sinochem has seen growth in the key energy business stagnate with increasing domestic competition in trading from the likes of state oil trader Unipec and Chinaoil, while its overseas oil and gas assets have struggled amid prolonged low oil prices.

ChemChina would add some 500,000 barrels per day of crude oil processing capacity to Sinochem's oil refining business.

Premium assets ChemChina acquired would also boost Sinochem's chemical departments.

The second source said a deal would benefit both companies: Sinochem's upstream oil and gas assets could feed ChemChina's nine refineries, Sinochem's access to rubber trading would help ChemChina's tyre business, while Sinochem's dominance in fertilizer markets would be a good fit for ChemChina's agri-chemical business.

"Sinochem is generally light on assets, while ChemChina is a more of a manufacturer," he said.

($1 = 6.6685 Chinese yuan renminbi)


(Additional reporting by Florence Tan in Singapore, Matthew Miller and Meng Meng in BEIJING, Joshua Franklin in ZURICH, Foo Wun Chee in BRUSSELS; Writing by Josephine Mason; Editing by Lincoln Feast and Mike Collett-White)

 

[ahojunk]

New figures ease economic concerns
By Wang Yanfei in Hangzhou (chinadaily.com.cn) Updated: 2016-10-15 13:20

Better than expected economic figures released on Friday eased concerns about hitting the annual growth target, but more efforts are needed to to sustain growth momentum in the long term, economist say.

Rising food prices in China pushed consumer inflation to a higher-than-expected 1.9 percent in September. Last month, food prices rose by 3.2 percent year-on-year. Zhu Xingxin / China Daily​

"The uptick of PPI and CPI in September provide good news for near term growth," said Yin Jianfeng, chief economist with China Zheshang Bank, during a panel discussion on the sidelines of the Zheshang Caijing International Forum on Friday.

The nation's producer price index (PPI) and consumer price index (CPI) figures for September are strong, official data shows.

The producer price index, a gauge for factory-gate prices, rose by 0.1 percent year-on-year in September, which is the first increase in nearly five years.

The consumer price index, which measures consumer price inflation, came in at 1.9 percent in September, above market expectations.

"But recent uptick figures are not enough to herald the recovery of economy," Yin said, "many problems within in the economy have yet to see major improvements—deleveraging process should be among top key tasks."

He said despite the nation's debt ratios not yet reaching the levels that would spark a crisis, "the pace of its increase is quite noteworthy".

Household debt levels have surged at a fast speed in recent years, which is a similar situation to what the United States experienced before its 2008 submortgage crisis, according to Yin. "Demand for home purchases rises sharply amid low-income households in recent years, but they have relatively lower abilities to cope with and recover from an income shock, compared to high or medium income households," he said.

UBS estimates that the loan to value ratio in China, which reflects the demand for housing, has risen to nearly 70 percent from 15 percent in 2012.

"A flood of defaults may trigger a crisis when a large proportion of credits flood to low income households," Yin said.

Yin said the risks brought by mounting household debt could be more alarming compared to that of the cooperate debt level.

"The cooperates might be more easier and would take less time for the government to control, compared to households," he said.

 

[ahojunk]

China to increase policy support for service sector
2016-10-15 11:36 | Xinhua | Editor: Wang Fan

China will offer more policy support to boost the growth of the service sector as a new engine to power the country's economic transition, according to the Chinese cabinet.

The government will cut red tape and ease restrictions for the development of elder care, education and sports services, according to a statement released after a State Council executive meeting chaired by Premier Li Keqiang.

Unreasonable administrative approvals needed to set up elderly care institutions will be eliminated and spare workshops or training centers may be turned into facilities for the elderly, according to the statement.

China will allow private schools to adjust their fees according to their own conditions and encourage domestic educational institutions to cooperate with foreign counterparts to improve competitiveness in state-of-the-art fields.

The government will roll out policies to promote recreational vehicles to boost tourism in rural or suburban areas, expand visa-free ports for inbound cruise tourism and pilot yacht leasing services, while local governments are encouraged to develop facilities for recreational sports, including winter sports.

China will further reduce barriers for private investment in consumer and service businesses.

The government will also roll out more supportive fiscal and financial policies to develop manufacturing of assistive devices for the disabled.

The statement said China will continue to reform business registration procedures by streamlining them and encouraging online services.

 

[ahojunk]

CSRC approves IPO applications of 14 firms
2016-10-15 18:49 | Xinhua | Editor: Wang Fan

The China Securities Regulatory Commission (CSRC) approved the IPO applications of 14 companies.

The firms will be allowed to raise a maximum total of 7.3 billion yuan (1.08 billion U.S. dollars), a statement said Friday.

Seven of the firms will be listed on the Shanghai bourse, two on the Shenzhen bourse's Small and Medium-sized Enterprise board, and five on the ChiNext, China's NASDAQ-style board of growth enterprises.

The CSRC has given the greenlight to IPO applications for 163 firms this year, putting the total funds raised at 113.2 billion yuan.

Under the current IPO system, new shares are subject to approval from the CSRC, which controls both the timing and pricing.

China is working on transforming its IPO approval system into one based on registration, one that will allow the bourses to take over IPO approvals and clear the backlog of companies on the waiting list.

 

[ahojunk]

China, Portuguese-speaking countries boost relations
2016-10-12 13:52 | Xinhua | Editor: Mo Hong'e

Chinese Premier Li Keqiang delivers a keynote speech at the opening ceremony of the 5th Ministerial Conference of the Forum for Economic and Trade Cooperation between China and Portuguese-speaking countries, in Macao, south China, Oct. 11, 2016. (Photo: Xinhua/Ju Peng)


Chinese Premier Li Keqiang announced on Tuesday that China has put forward 18 new measures, including offering aid and preferential loans, to boost relations with Portuguese-speaking countries (PSCs) in the next three years.

China will offer aid and preferential loans worth at least 4 billion yuan (almost 600 million U.S. dollars) to PSCs in Asia and Africa, Li said.

He made the announcement at the opening ceremony of the 5th Ministerial Conference of the Forum for Economic and Trade Cooperation between China and Portuguese-speaking countries in Macao.

At least 2 billion yuan in aid will be given to help develop agriculture, facilitate trade and investment, prevent and control malaria, and conduct research on traditional medicine in these countries.

At least 2 billion yuan in preferential loans will be offered to promote industrial production capacity cooperation and infrastructure development in these countries. In addition, China will cancel 500 million yuan of debt matured from its interest-free loans to the underdeveloped PSCs in Asia and Africa attending the forum.

China also pledged to send more medical teams, offer training programs and government scholarships, and help PSCs from the forum that need to build marine meteorological facilities to respond to disasters and climate change.

China encourages domestic businesses to establish new or upgrade existing economic and trade cooperation zones in PSCs, and it supports the establishment of a China-PSCs financial service platform, an entrepreneurs' association, cultural exchange center, bilingual talent training base and youth innovation and startup center in Macao, according to the package.

The Forum for Economic and Trade Cooperation between China and PSCs was launched in Macao in 2003 with the participation of seven PSCs, namely Angola, Brazil, Cape Verde, Guinea Bissau, Mozambique, Portugal and Timor-Leste.

CLOSER CHINA-PSC TIES

China is willing to build more substantial economic and trade ties and develop long-term stable and sound partnerships with PSCs, the Chinese premier said.

China and PSCs account for 17 percent of the global economy and 22 percent of the world population, and their common interests and need for mutual support are increasing, said Li.

The Belt and Road Initiative accords with the development plans of many PSCs, Li said, noting that both China and PSCs are located along the major international shipping routes.

Bilateral relations between China and PSCs are at their best period in history, said Li, pointing to the fact that trade between the two sides amounted to almost 100 billion U.S. dollars last year.

Over the next five years, China's total imports are expected to reach 8 trillion U.S. dollars, with total outbound investment of 720 billion dollars and more than 600 million in outbound travel, meaning huge business opportunities for companies from all countries, including PSCs, said Li.

The two-day ministerial conference in Macao was attended by leaders and senior officials of the seven PSCs. The forum and Macao will play a more important role in boosting closer cooperation between China and PSCs.

A complex for the China-PSCs cooperation platform will be built in Macao to provide services in trade talks, trade shows and cultural exhibitions and exchanges. The facility is set to become a new landmark for bilateral cooperation.

Portuguese Prime Minister Antonio Costa said Macao has the potential to become an information-sharing platform for business cooperation and bilingual talent, a logistics center for commodities from PSCs and a service center for small and medium-sized enterprises.

China's Belt and Road Initiative can strengthen economic ties with PSCs and Portugal is willing to participate in building the 21st Century Maritime Silk Road, Costa said.

Mozambican Prime Minister Carlos Agostinho do Rosario said much progress has been made in human resources development, technological assistance and investment within the forum framework.

 

[ahojunk]

Sinochem, ChemChina to be merged, sources disclose
2016-10-15 10:42 | China Daily | Editor: Wang Fan

Analysts say two giants are complementary to each other, both stronger in niche markets

Sinochem Group and China National Chemical Corporation (ChemChina) are going to be merged into one company, according to a news agency report quoting sources on Friday, which sent their two shares surging.

News agency Bloomberg, which quoted sources close to the talks, said that details of the deal, including timing, were not immediately clear and the plan was still subject to change. Comments from the two companies were not available on Friday.

Sinochem, founded in 1950, is China's biggest agricultural companies by revenue with operations in fertilizers, seeds and agrochemicals. Its business also encompasses oil, real estate and non-banking financial services. It has four A share listed companies and four Hong Kong listed companies.

ChemChina is China's biggest chemical company with revenues of $45 billion in 2015. Its main businesses are chemicals, oil processing, tire and rubber products and chemical equipment.

"The two companies' businesses are complementary to each other. Sinochem, however, has a much wider portfolio than ChemChina. If merged, Sinochem will be the leader in the new company," said Gao Jian, an oil analyst with Shandong-based bulk commodity information company Sublime China Information Group Co Ltd.

"The two companies account for quite a small share in petrochemical engineering. They are stronger in niche markets such as new materials, fertilizers and agriculture," he said.

According to Gao, unlike the merger of mammoth companies such as Baosteel Group and Wuhan Iron and Steel Group, this merger is a lot smaller and unlikely to have much impact one their strategic plans.

Sinochem International Corp, Sinochem's listed unit on Shanghai Stock Exchange, rose to 10.57 yuan ($1.6) per share, up 9.99 percent, on Friday.

Sinochem has been active in overseas acquisitions in recent years. In February it proposed a $43 billion purchase of Swiss pesticide and seed group Syngenta AG. If being pushed through, that merger would become the biggest overseas purchase by a Chinese company so far.

In January, a consortium led by Sinochem proposed a $1 billion purchase of KraussMaffei Group, the German plastic equipment manufacturer. If successful, the deal would be the biggest takeover by a Chinese company of a German group. Also in January, Sinochem initiated a deal to buy Halcyon Agri Corp, a Singaporean natural rubber supply chain management company, for a proposed price of around $300 million.

 

[ahojunk]

Chinese, U.S. enterprises sign agricultural transaction contracts
2016-10-16 09:03 | Xinhua | Editor: Huang Mingrui

More than a dozen Chinese and the U.S. enterprises on Friday signed agricultural transaction contracts worth 2.1 billion U.S. dollars, under which Chinese enterprises will import 5.1 million tons of farm products from the U.S. companies.

Nearly 100 officials and enterprise representatives from China and the United States attended the signing ceremony held in Des Moines, Iowa.

As Iowa is a leading soybean-producing state in the United States and China is the world's biggest buyer of the product, it makes a lot of sense for American and Chinese companies to work together, Iowa Governor Terry Branstad told Xinhua.

"Right now we have a surplus of soybeans and corn, and so we need to be able to market that product," said Branstad. "China is a very big country, with a large population and is in need of soybeans. We think it is a win-win situation. It's good for Iowa farmers and it is good for Chinese consumers."

"We want to continue to increase the trade opportunities between Iowa and China," Branstad added.

Liu Jun, deputy Chinese consul-general in Chicago, said the U.S. Midwest is a major farming area of soybeans, corn, and meat. "Iowa has unique advantages in Sino-U.S. agricultural cooperation."

Chinese official statistics show that China accounts for 60 percent of the world's soybean transactions. China consumed 95 million tons of soybeans in the 2015-2016 seasonal year, and is expected to consume 98 million tons in the following seasonal year, of which the demand for import will be 83 million tons, up 1.2 percent from the 2015-2016 seasonal year.

 

[ahojunk]

http://www.ecns.cn/business/2016/10-15/230334.shtml

Chinese luxury spending to reach 120 bln USD in 2016: report
2016-10-15 09:30 | Xinhua | Editor: Wang Fan

Chinese luxury spending is expected to reach 120.4 billion U.S. dollars in 2016, up 3 percent year on year, according to a report on Friday.

The growth rate is down from last year's 10 percent as a sluggish economy dampens consumption of luxury goods, according to the report released by Fortune Character, a luxury consumption research agency.

But Chinese consumers still account for nearly half of the world's luxury spending, it said.

Chinese buyers did 77 percent of their luxury spending overseas, it said.

Zhou Ting, president of Fortune Character, said Hong Kong and Europe remain popular destinations for Chinese luxury purchases.

Over the past five years, fewer Chinese high-end buyers said they would increase their luxury purchases, the report said. In 2016, only 17 percent respondents planned to increase luxury spending, according to the report.


********

120 billion dollars is a lot of money.

 

[ahojunk]

Debt-for-equity swaps to substantially reduce corporate leverage: official
2016-10-14 10:25 | Xinhua | Editor: Mo Hong'e

China's newly-initiated debt-for-equity swaps will substantially lower the debt levels of indebted companies, and no cap will be pre-set on the scale of the scheme, an official with China's top economic planner said Thursday.

The deleveraging effect of the program should be obvious, and model simulation results show that many companies' debt-to-asset ratios will decrease by about 10 to 20 percentage points, said Zhao Chenxin, a spokesman for the National Development and Reform Commission (NDRC).

China's State Council on Monday released guidelines on the long-discussed debt-for-equity swaps, pledging that the scheme will be conducted in an orderly fashion as the country steps up efforts to tackle high corporate debt.

The program will help substantially ease companies' financial burdens, Zhao said at a press conference, adding that "the final outcome and effectiveness will hinge on negotiations between companies and creditors."

High corporate leverage in China has been a major threat to companies' profitability and to broader financial stability.

Debt-to-equity swaps are generally believed to benefit both banks and troubled companies. They can ease pressure on companies and beef up banks' balance sheets, releasing capital for investment.

This round of the debt-for-equity conversion program is "market-oriented," and there is no predetermined scale of the plan, Zhao stressed.

 

[ahojunk]

Chinese vice president attends China-LAC business summit
2016-10-15 11:34 | Xinhua | Editor: Wang Fan

​

Chinese Vice President Li Yuanchao delivers a speech at the 10th China-Latin America and Caribbean (LAC) Business Summit in Tangshan, north China's Hebei Province, Oct. 14, 2016. (Xinhua/Yang Shiyao)


Chinese Vice President Li Yuanchao on Friday attended the 10th China-Latin America and Caribbean (LAC) Business Summit in the northern city of Tangshan in Hebei Province and delivered a speech.

Since the summit's creation in 2007, it has become an important platform for mutually beneficial cooperation and common development of China and LAC nations, Li said in the speech.

He said he hopes the two sides can consolidate their traditional friendship and continuously enhance mutual understanding.

Both sides should also optimize trade structure and promote production cooperation, as economic and trade cooperation is a pillar for China-LAC relations, Li said.

China-LAC trade volume rose more than twentyfold during the past decade to reach 236.5 billion U.S. dollars in 2015.

Li also stressed the improvement of people-to-people exchanges in multiple fields, including education, culture, sports and tourism.

On Friday, Li also met with President of Uruguay Tabare Vazquez, who attended the summit and delivered a speech, and other guests from LAC countries.

 

[ahojunk]

SinoChem, ChemChina subsidiaries deny reports of talks for $100 bln merger
2016-10-17 09:09 | Global Times/Agencies | Editor: Li Yan

Multiple subsidiaries under SinoChem Group and China National Chemical Corp (ChemChina) denied media reports claiming that the two groups are in merger talks, financial news portal ifeng.com reported on Sunday.

State-owned chemical companies SinoChem Group and ChemChina are in discussions about a tie-up to create a global chemical, oil and agricultural giant with almost $100 billion in annual revenue, Reuters reported Friday, citing three sources familiar with the matter.

Measured by revenue and profits, Sinochem is much larger than its rival ChemChina, which is finalizing a $43 billion takeover of Swiss pesticides and seed group Syngenta. That deal would be China's largest-ever foreign investment.

The domestic merger was proposed by China's central government as part of its effort to slash the number of State-owned companies and create larger, more competitive global industry players.

Five listed units of ChemChina, including Shanghai-listed Aeolus Tyre Co, said in stock filings that after contacting the group company and stakeholders, they had found no government information in written or oral form about a reported merger between SinoChem and ChemChina as of Sunday.


********

Looks like some information warfare or misinformation going on.

.

 

[ahojunk]

China's new yuan loans surge in September
Source: Xinhua 2016-10-18 16:30:31


BEIJING, Oct. 18 (Xinhua) -- China's new yuan-denominated lending beat market forecasts in September to stand at 1.22 trillion yuan (about 181.3 billion U.S. dollars), official data showed Tuesday.

The monthly lending figure represented an increase of 164.3 billion yuan on the same period a year earlier, the People's Bank of China said in a statement.

New yuan-denominated loans totalled 10.16 trillion yuan in the first nine months of the year.

M2, a broad measure of the money supply that covers cash in circulation and all deposits, rose 11.5 percent year on year to 151.64 trillion yuan by the end of September, with the growth rate 0.1 percentage points higher than a month earlier.

M1, a narrow measure of money supply that covers cash in circulation plus demand deposits, rose 24.7 percent year on year to 45.43 trillion yuan, with the growth rate 0.6 percentage points lower than a month ago.

 

[cirr]

Q3 GDP grew 6.7% y-o-y.

 

[Bussard Ramjet]

Economists Question China’s Consistent Growth Numbers
China says its economy grew 6.7% for the third consecutive quarter

BEIJING–Fresh doubts emerged over the reliability of Chinese statistics on Wednesday after officials said the economy grew 6.7%—for the third consecutive quarter.

It was the first time since Beijing started releasing quarterly figures in 1992 that it had achieved such a feat of consistency.

Economists say it is rare for a fast-growing economy to clock the same growth quarter after quarter. In China, it happens because Beijing sets a hard economic target—6.5% to 7% this year—then does what it takes to reach this level, whether through fiscal stimulus, arm twisting of state companies or creative accounting, these people say.


The International Monetary Fund and numerous economists have urged Beijing to scrap that system, saying it leads to excessive fiscal stimulus that fuels manufacturing overcapacity and debt.

“It’s quite implausible that growth would be 6.7% for three straight quarters,” said Julian Evans-Pritchard, an economist with Capital Economics Pte. “They’re obviously smoothing the data quite a bit” he said, adding: “Even by Chinese standards, this is a new level of stability.”

China’s one-party state places a premium on stability, control and gradualism, economists say. Higher growth targets also help stem unemployment that could fuel social instability and threaten party control, they add. China’s official unemployment rate has remained between 4% and 4.3% since 2002. Yet a paper from an American nonprofit group, the National Bureau of Economic Research, says the actual rate was an average of nearly 11% between 2002 and 2009.

Economists say Chinese growth data appears to be massaged by one or two tenths of a percentage point–worth $10 billion to $20 billion in output. Any more would draw heightened global scrutiny, they say.

RELATED READING

• China’s Property Frenzy Spurs Risky Business (Oct. 19)
• Finding Cracks in China’s Growth Story: Heard on the Street (Oct. 19)
• What U.S. Economists Think of Official China Statistics (Sept. 15, 2015)

“There always seems to be a tendency to round up rather than down,” said IHS Markit Ltd.economist Brian Jackson. “They tend to use something like the “other services” category.

China’s National Bureau of Statistics didn’t immediately respond to questions. But in the past it has said that its methodology is sound and in keeping with accepted global standards.

In past periods of double-digit growth, Beijing often appeared to go the other way, understating growth and inflation numbers, economists say. A study this year by economists Emi Nakamura, Jón Steinsson, and Miao Liu in the American Economic Journal concluded that China underreported growth by several percentage points a year in the late 1990s, then overestimated growth and inflation after 2002. “Chinese official statistics are ‘too smooth,’” it said, which it said may be the result of political sensitivities as well as poor data gathering methods.


“Concerns about inflation are one factor often cited as contributing to the discontent that lead to the 1989 Tiananmen Square protests,” it said. “The remarkable stability of growth and inflation statistics over the past two decades has undoubtedly been an important source of popular support for the Chinese Communist Party.”

China’s statistics have also come under question at home. When Chinese Premier Li Keqiang was party secretary of northeastern Liaoning province in 2007 he was quoted in a leaked U.S. cable decrying the accuracy of what he called “man-made” statistics, adding that he relied on measures presumably more difficult to manipulate, including electricity output and freight traffic.

Since then, numerous banks have created their own version of a “Li Keqiang index” inspired by his apparent skepticism.

China has made periodic efforts to improve—or at least defend—the veracity of its growth numbers. Earlier this month, President Xi Jinping stressed the importance of preventing fake government statistics, vowing at a central leading group on reform to punish data cheaters, according to the official Xinhua News Agency.

Late last year, local officials in northeastern Liaoning, Heilongjiang and Jilin provinces admitted doctoring gross domestic product statistics during an anticorruption probe, Xinhua said.

Officials have strong incentives to fudge growth statistics, economists say. While Beijing has edged away from evaluating local officials solely on growth statistics, the numbers remain an important criterion for getting promoted. Double counting is another factor when, for example, transactions across borders are claimed by both provinces. National statisticians now collect their own independent provincial data in a bid to improve the data’s accuracy. In 2015, China adopted an IMF standard aimed at strengthening its data system.

The official 6.7% growth figure for the January through March period, when growth seemed particularly weak, was the most questionable of the three, many economists said.

Mr. Evans-Pritchard said growth in the third quarter may have exceeded 6.7% while the first quarter was lower. “This allows China to reverse some massaging they did earlier, bring their data closer to reality,” he said.

RHB Capital Bhd. economist Fan Zhang warned: “There could be more intervention as growth slows. They’ve set a target of 6.5% from now until 2020 and need to make that target.”


http://www.wsj.com/articles/economists-question-chinas-consistent-growth-numbers-1476880761

 

[lonelyman]

10 trillion economy at 10%, that's unsustainable. Size bigger, grow rates lower, very natural. A simple Google search yields numerous western sources question India gpd as well.

Don't fall for western propaganda, remember WMD in Iraq?