This editorial on The Economist say that fears that China’s economy is overheating are exaggerated:
Chinese students may come top of the world league in mathematics, yet the country’s economic numbers are notoriously dodgy. New figures showing that China’s GDP growth quickened to 11.9% in the year to the second quarter, its fastest since the mid-1990s, while inflation jumped to 4.4% in June from 3.4% in May, have fuelled concerns that its economy is now seriously overheating. However, a closer inspection of the numbers suggests there is no need to panic”yet.
China is always one of the first countries to report its GDP after the end of each quarter. But speed kills accuracy. Each province later publishes its own growth numbers, which have consistently averaged higher than the national figure in recent years. Moreover, if you add up the main components of GDP”investment, consumption and net exports”you also get a higher growth rate. [Full Text]
