December 17, 2005
Beat that growth rate!
There's no question that China is experiencing very strong growth. But exactly how much? I doubt that anybody knows for sure.
Posted by James Hamilton at December 17, 2005 07:27 AMdigg this | reddit
Don't intelligence agencies still use satellite observations for such things? ;-)
It would be amusing to see how building counts, land under agriculture, road miles (and maybe even CO2 release) have all changed since the 70's.
Posted by: odograph at December 17, 2005 09:32 AM
How can you confuse the once-for-all effect of a change in national-accounts methodology with growth? I don�t know good the new accounts are, but the old ones were really bad. Indeed there are serious problems to link the two sets of accounts.
Posted by: Edgardo Barandiaran at December 18, 2005 02:56 AM
Of course this isn't actual growth, Edgardo. I was making a joke about the numbers.
Posted by: JDH at December 18, 2005 05:07 AM
Those numbers are not only for joking. The change effectively confuses the Chinese growth rate and make time-series obsolete. The growth in last year was lower in % of GDP is the GDP was really higher than estimated before. On the other hand, China is nearer the announced economic targets than was thought before. So the government can say that they are performing well even if the growth rate will be lower.
I think this is the point here. I see this as a sign of lower Chinese growth.
There are also other signs. One of them is the coal mining agreement with Mongolia. Why should Chinese start mining and importing coal from Mongolia? It is much farther from the Chinese industrial heartlands than the present Chinese coal mining regions. And this in a situation where about 70% of the Chinese railroad capacity goes to coal transports. The answer is obvious. The limits of the coal production growth in China are beginning to be felt. In China coal = energy (70% of all energy use). Lower domestic energy growth means lower economic growth and more oil and coal imports.
We will see.
Posted by: TI at December 18, 2005 07:57 AM
Don't understand your point about Mongolia. China already has its largest coal operator in its Inner Mongolia province. Mines and railroads take years if not decades to develop. Sounds more like a strategic move. BTW China also owns coal mines in Australia and buys coals from the likes of BHP. US has restarted exporting coals to Asia (presumably because China reduced its export). I don't see how you infer a slow down from a single event in Mongolia.
Posted by: HZ at December 20, 2005 04:32 PM
HZ, the point about Mongolia was made by TI, not by me.
Posted by: JDH at December 20, 2005 05:29 PM