December data raises eyebrows
Accuracy of surprisingly good trade figures is questioned, amid suspicions of manipulation
Beijing's announcement of surprisingly good trade data for December has prompted more doubt than relief, since it contradicts several other indicators as well as figures from trading partners.
The discrepancies suggest the mainland's trade situation may be worse than official data reveals. Prominent economists are also sceptical about the quality of the export and import data, saying the picture may become clearer only after a few months.
According to the customs bureau, exports rose 14.1 per cent in December from a year earlier, a big jump from November's 2.9 per cent rise. That substantially exceeded economists' expectations of 5 per cent growth. Imports also posted a surprising 6.1 per cent gain, much above the 3.5 per cent consensus estimate.
The new data came after the official manufacturing purchasing managers' index (PMI) showed new export orders fell in December from the previous month. PMI data tracked by HSBC showed a similar decline.
Adding to the doubt over the trade data was throughput at Shanghai port in December, which showed a drop of 0.44 per cent to 41.1 million tonnes, according to Shanghai International Port (Group).
"While there might be time lags between placing orders and shipping goods, we are more inclined to believe that duty-free special zones played a role in the inconsistency," said Liu Li-gang, head of Greater China economics at ANZ Bank.
Song Yu of Goldman Sachs said local authorities can bump up the numbers by round-tripping, or moving goods in and out of special zones, though so far "there's no concrete evidence to suggest this is what actually happened".
In November, exports through bonded zones jumped 49.7 per cent from a year earlier, when mainland exports overall grew just 2.9 per cent. December data on bonded-zone exports is yet to be published.
Liu said local authorities may have "greater incentives" to window-dress the results using bonded zones in an unusually bad trade environment.
Discrepancies have been detected in other areas too, such as exports to Taiwan and South Korea and the latter's imports from mainland China in recent months. UBS Securities analysts note that historically these figures track each other.
Based on the January 3 data from South Korea's Ministry of Knowledge Economy, imports from China fell 6.8 per cent last year, the second sharpest decline among Korea's major trade partners. But Beijing's data showed shipments to South Korea rose 5.7 per cent last year.
On December 28, Commerce Minister Chen Deming said the possibility of local governments cooking trade data could not be ruled out, according to a report from sina.com.