Amid the troubles visible in China’s economy, statistical problems and anomalies are rising to the surface, bringing into doubt some bedrock economic indicators. Arguably the most important of these is China’s vaunted trade surplus. A large gap between payments recorded by China’s banks and the value of imports and exports reported by Customs has led several economists to wonder publicly how to measure China’s trade volumes. It is already well established that hundreds of billions of dollars in ‘hot money’ flows through the trade account. It is also well known that banks do not make payments in trade with reference to General Administration of Customs (GAC) documentation, so there is good reason for the numbers to differ. Balance of payments data shows that, in net terms, money is leaving China despite the reported surplus. But few have systematically questioned or examined the trade surplus.
Bookmarks