China’s High GDPs: Facts or Fabrications?

May 11, 2010 Updated: May 11, 2010

As of the end of April, 31 Chinese provinces and major cities have released first quarter gross domestic product (GDP) figures. Among the reports, 29 provinces and major cities have posted growth rates higher than the 11.9-percent national average, and 19 provinces reported growth rates higher than 15 percent. The record growth of 25.1 percent was claimed by Hainan Province. Only the remote areas of Xinjiang and Tibet stated growth rates lower than the national average.

In this first quarter, China’s stated GDP reached 8.0577 trillion yuan (US$1.18 trillion), rising by 11.9 percent—a 5.7 percent increase compared with the same period last year. This was the fastest growth since 2007, according to the data released by China State Statistic Bureau (CSSB) on April 15.

Consumer Price Index and Producer Price Index rose by 2.2 percent and 5.2 percent, respectively.

Since 1985, when provinces and the state started to separately calculate their GDPs, the numbers from provinces have frequently been higher than the national GDP. In 2009, 26 provinces reported a GDP greater than 10 percent, while the national average was 8.6 percent. In the first half of 2009, the total GDP of local regions was 1.4 trillion (US$0.2 trillion) yuan higher than the national GDP.

A former director of CSSB, Li Deshui, once revealed that the average provincial GDPs in 2004 were 3.9 percent higher than the national GDP. CSSB attributed the discrepancy to the differences in the GDP estimation methodology, as well as system loopholes, such as repeated listing and enumeration.

A Chinese online media,, carried comments from citizens saying that the unconformity of GDP statistics is “produced by CCP [Chinese Communist Party] officials who are promoted on account of those numbers,” alleging that such economic data is often fabricated by officials in each level of government.

Wu Xiaoling, a member of the CCP’s National People's Congress Standing Committee, said that the GDP has become an important index for the performance of local governments, creating the impetus for fraud.

In a Jan. 4 analysis of China’s economy, renowned Chinese economist He Qinglian said, “China's real estate industry accounted for 6.6 percent of its total GDP, as well as a quarter of its fixed-asset investments.”

According to He's article, while the Chinese regime prides itself on its economic vitality, “international economists, on the other hand, are troubled over China's real estate super-bubble and believe the bogus prosperity—engineered by the Chinese regime through the use of asset bubbles—will inevitably result in a real depression.”

Read the Chinese article.