Asia Times, For years, investors and economists have been scratching their heads over China's growth rate. As the nation has turned into the world's workshop, questions about the reliability of its statistics have become important. The difference between a China expanding at 9% and a China growing at 4% is an astounding US$65 billion in annual output.
China's $1.3 trillion economy is the second largest in Asia and some say it was largely responsible for keeping the world from sliding into recession in 2001- if the numbers are reliable. Jonathan Anderson, a Hong Kong-based economist for Goldman, Sachs & Co figures the annual growth rate is 9.6%. He is not wide off the mark. In fresh proof that the “cooling down” policy isn't quite working, figures released by China's National Bureau of Statistics on Wednesday revealed that the country grew an amazing 9.5% from a year earlier to 3.14 trillion yuan ($379 billion) in the first quarter as exports and investment surged.
A tremendous achievement indeed. But the question uppermost in the minds of many remains: how has China achieved this miracle? Economists studying China face thorny theoretical and empirical issues, mostly derived from the country's years of central planning and strict government control of many industries, which tend to distort prices and misallocate resources. In addition, since the Chinese national accounting system differs from the systems used in most Western nations, it is difficult to derive internationally comparable data on the Chinese economy. Figures for Chinese economic growth consequently vary depending on how an analyst decides to account for them.
