How a country can hit its growth targets every year:
1. Forecast next year's growth, make that the "target"
2. If growth misses the target, fudge the numbers for that year to make it look like you hit the target, and spread the difference across the next few years
3. Repeat
1. Forecast next year's growth, make that the "target"
2. If growth misses the target, fudge the numbers for that year to make it look like you hit the target, and spread the difference across the next few years
3. Repeat
This method only fails if growth surprises in one direction for several years in a row. And even then you can just wait a decade for people to figure out what the real numbers were, and by then no one cares.
bloomberg.com/news/articles/…
bloomberg.com/news/articles/…
From a politician's perspective, there's really no downside to this as long as everyone who makes policy knows the true numbers. The upside is that you make the government look omnipotent, and you prevent fickle investors from stampeding out of the country if growth dips.
So every time you see a story that "China hit its growth target", realize that this is almost certainly what's happening.
If you're one of those fickle investors/traders, it means you need to look elsewhere for info. But for the rest of us, it just means that the true economic story of China is revealed only slowly, over decades rather than years.
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