Again a slowdown in China’s economic growth
China’s GDP Gross Domestic Product grew in the first quarter of 2013 7.7 %, in the last quarter of 2012 the figure was 7.9 %. Also other indicators tend to a slowdown of China’s economy
Industrial output decelerated from February 9.9 % to March 8.9 % growth and also retail sales were disappointing with a growth in March of 12.6 %, a sign that the raising domestic consumption goal of the Chinese Government is far from being reached.
The export front presents a drop of 10 % in March and 23.6 % for the two previous months. Imports rose 14.1 % in March, in the two previous months there was a five percent growth rate. The trade balance resulting is a deficit of CNY 880 million or around USD 142 million.
Exports to Hong Kong increased in the first quarter of 2013 74.2 % (never before such high levels were reached), while exports to Europe grew 1.1 % and to the U.S. 6.8 %. In regard to China’s trade with Hong Kong experts estimate that the excessive increase is based on the fact that provincial and local government officials are creating arbitrary trade increases to protect their political status! There is the example cited that seven northeastern provinces issued a “military order” to maintain the nearly 10 % growth rate. Then local governments adopted an unconventional method to boost the trade volume via Hong Kong’s special customs controlling zone. There is another example that some local governments paid freight costs for companies in the special customs controlling zones to ship all their warehoused goods to Hong Kong and then back the next day! Each container load counts USD four million in rate and the round trip can generate USD 800 million, allowing some special zones to achieve USD 1.6 billion in trade volume in 40 days. Western experts have expressed doubt in regard to the recent credibility of official numbers on the development of the Chinese economy. Also the declaration from party leader Xi Jinping at a Forum that China will import goods of USD one trillion over the next five years met rising eye brows.