China’s economy grows 6.7% in 2016
China’s economy grew by 6.7% in 2016, compared with 6.9% a year earlier, according to official data, marking its slowest growth since 1990.
The figure is in line with Beijing’s growth target of between 6.5% and 7%.
But the data comes days after the leader of one Chinese province admitted GDP data was faked for several years.
China is a key driver of the global economy and a growth slowdown is a major concern for investors around the world.
Some analysts have taken heart from data showing growth in the last three months of 2016 was at an annual rate of 6.8% – a slightly faster pace than the rest of the year.
But many observers have been saying for years that the country’s growth was actually much weaker than the official data suggests. And those beliefs gained more support this week, when the governor of Liaoning, Chen Qiufa, said his province had been “involved in a large-scale financial deception” between 2011 and 2014, and that economic data had been doctored.
Addressing reporters’ questions about the Liaoning admission, the director of the National Bureau of Statistics said on Friday that the national data was “truthful and reliable”.
Ning Jizhe added that “statistics departments on various levels will also be strengthening the law enforcement, supervision, and checks on figures” and “resolutely guarding and preventing” the fabricating of data.
China is the world’s second-biggest importer of both goods and commercial services, meaning its economic performance has a big knock-on impact around the world.
It plays an important role as a buyer of oil and other commodities, and its slowdown has been a factor in the decline in the prices of such goods.
Beijing’s aim to rebalance the economy towards domestic consumption has led to major challenges for large manufacturing sectors, and there have been layoffs – especially in heavily staffed state-run sectors such as the steel industry.
Plenty of economists think that GDP is a massively flawed form of measuring the health of any economy but in this country it is even worse.
There is a significant proportion of China watchers who don’t believe the GDP figures are real at all. For example, in 2016, the country’s (year on year) GDP was exactly 6.7% for three quarters in a row. While this seems numerically unlikely, I suppose it is possible that this could happen.
Without solid, reliable figures this remains a debate with wide-ranging, conflicting views. Mind you, even if at worse China’s real GDP is around 4% at present, there are plenty of national governments which wouldn’t mind a taste of those numbers.