Getting More Convinced, But Not There Yet
A lot has been written recently about the economic recovery and the continued “great leap forward” of China’s GDP. Although I am impressed with the numbers and with the speed of the recovery, I take this with a grain of salt, given the huge government stimulus package and inconsistent reporting of GDP figures.
China’s US$585 billion spending bill announced a year ago did have an impact and kept the economy moving. But most of the money was allocated to building infrastructure, which is capital but not manpower intensive and thus should not be expected to considerably increase the number of confident consumers with spare cash to spend.
Many analysts also pointed out often inconsistent GDP numbers reported by local and central authorities. Sometimes the locally reported numbers would not add up, and sometimes they would be higher than the official GDP reported by China’s National Bureau of Statistics. Of course, the inconsistencies may not be that great and may