By Peter Cai
The Asian Financial Crisis of 1997-98 is also another period in which there was a significant discrepancy between key economic indicators and the official GDP estimate. 1997 was a difficult year for the Chinese economy after Beijing tightened its fiscal policy to cool down an overheated economy, electricity and railway freight both declined considerably, yet the official estimate still put the growth rate at 9. 3 per cent.
For example, during the global subprime mortgage meltdown, China maintained a growth rate of 9. 1 per cent, sparking wild talk of China’s ability to decouple its economic growth from that of the US and the eurozone. However, Wu argues China only managed to grow 4. 7 per cent in 2008, more than 50 per cent less than the official estimate.
However, despite a significant decrease in these two key economic indicators, the official estimates for 2008 and 2009 GDP growth are still healthy at 9. 6 per cent and 9. 2 per cent, respectively. “I think the figures from these two years are inflated and not very accurate,” said Professor Wang.
Read more here: Business Spectator