China’s National Bureau of Statistics reported that its purchasing manufacturers index (PMI) rose to 50.5 in March from 49.2 in February. Any number under 50 signals a contraction, so the news was good for the world’s second-largest economy which has faltered recently, likely because of trade tensions with the U.S. However, official data from China has long been viewed as flawed, and by some experts as false.
China’s general economic picture has weakened in the last several months, as GDP has slowed along with exports. This has put pressure on the central government which has been in negotiations with the U.S. government over a broad trade agreement which would end tariffs that affect tens of billions of dollars of exports. The China economic slowdown pictures seem accurate based on the general tilt of the global economy and China’s trade challenges, but are the results the data show actually worse?
According to Asia News:
More and more economists and experts are warning that the statistical data about China’s economic growth simply do not add up. The figures provided by the country’s National Bureau of Statistics (NBS) appear inaccurate.
Investors.com wrote, based on an interview with China experts Luis R. Martinez of the University of Chicago:
China’s average GDP growth has been roughly 30% less than reported, based on the measures of its changes in national lighting. This would be an enormous shift in how we view China’s economy.
The St. Louis Fed’s economist reported:
Skepticism for Chinese official economic data is widespread, and it should be. Even if every Chinese economic number were reported truthfully and accurately to the best of an individual’s understanding, the official numbers would still fail to fully capture the evolution of an economy growing and changing so quickly.
Did China’s PMI recover this month? Maybe not.