Data disappearing act hides China’s economic plight
Beijing manages ‘optics instead of fundamentals’ as it dumps home sales stats amid official crackdown
Bad news is suppressed or sanitized in China. Economic data can appear one month and disappear the next. With a wash and a spin, it pops up later in the year as if nothing had happened, apart from a shiny new positive look.
The latest example from the control freaks inside President Xi Jinping’s ruling Communist Party involves the real estate market. Residential prices are resembling a stalled building site after the property meltdown more than four years ago.
Earlier this week, media reports surfaced that the Ministry of Housing and Urban-Rural Development had “suspended” publication of home sales. The crucial numbers were compiled by the China Real Estate Information Corporation and the China Index Academy.
The decision was made just weeks before the official stats were due to drop. In the past, those figures gave a glimpse of the moribund residential market ahead of the official data released by the National Bureau of Statistics.
“[Yet] this isn’t the first time authorities have clamped down on negative property data or cracked down on online ‘bearish narratives’ about the property market,” Trivium China, the research and consultancy group, warned.
“Clamping down on early housing indicators risks deepening investor and homebuyer skepticism when confidence is already in short supply. Resorting to data suppression suggests officials are now managing optics instead of fundamentals,” it said in a newsletter.
Chinese officials have stopped publishing hundreds of data points.
The Wall Street Journal
Now you see them, now you don’t:
- In May, The Wall Street Journal highlighted China’s data disappearing act. Beijing has “stopped publishing hundreds of economic” statistics, the WSJ said.
- A month later, the China Labor Bulletin, an independent advocacy group for workers’ rights, was forced to shut down. The NGO was “no longer [able to] maintain operations.”
Delve deeper: As the door closed, it warned, “the reality for many Chinese workers, particularly those in manufacturing, remains deeply troubling … with basic wages often [falling] below subsistence levels, compelling workers to endure excessive overtime.”
Between the lines: “This situation is exacerbated as plummeting orders push factories towards bankruptcy, leaving workers unpaid and stripped of social security protections,” the China Labor Bulletin stated.
Big picture: Against this backdrop lingers a “dark” secret. “Not long ago, anyone could comb through a wide range of official data from China. Then it started to disappear,” The Wall Street Journal stressed back in May.
Bottom line: “Land sales measures, foreign investment data, and unemployment indicators have gone dark. Data on cremations and a business confidence index have been cut off. In all, Chinese officials have stopped publishing hundreds of data points,” the WSJ said.
China Factor comment: Since then, Beijing has massaged so many numbers that they lack shape or form. As the latest home sales fiasco illustrates, even Comrade Xi can not fool all of the people all of the time.