Chinese Province ‘Busted’ For Fake Data; Exaggerated 2013 Output By Over 150%

Chinese Province ‘Busted’ ForFakeData; Exaggerated 2013 OutputByOver 150%

Still believe that China’s PMI is above 50 and suggesting a global growth expansion? Still believe in Santa and the Tooth Fairy? Well, none other than China’s own National Bureau of Statistics has been forced to admit that at least one of its major provinces has dramatically overstated industrial output. As Sinareports, according to a NBS report, thegovernmentinChina’sYunnanprovincehadcoercedlocalcompaniestoreportinflatedindustrialoutputvalue, resultinginartificiallyhigheconomicfigures. With government leadership promotions driven by the performance of economic numbers in each province, it should hardly be surprising but the scale of the fraud is remarkable. In 2012, one county in Yunnan province reported CNY6.34 billion in output while audits showed only CNY 2.82 billion and inthefirsthalfof 2013, YunnanpublishedCNY 2.75 billioninoutputwhileauditsshowed a mere CNY1.06 billion! The province was also found to have faked investment data.


China’s National Bureau of Statistics (NBS) on Thursday announced it had uncovered a serious case involving thefakingofeconomicdataby a countygovernmentinsouthwestChina’sYunnanProvince.

According to the NBS’s publicized report, the government of Luliang had coerced local companies to report inflated industrial output value, resultinginartificiallyhigheconomicfigures.

Twenty-eight sampled local companies reported a total of 6.34 billion yuan (1.03 billion U.S. dollars) in industrial output value in 2012; however, the actual value was only 2.82 billion yuan, based on initial calculation, according to the report.

Similarly, 25 sampled local companies reported 2.74 billionyuanofindustrialoutputvalueinthefirsthalfof 2013, buttheNBSinitiallyverifiedtheactualvaluetobeonly 1.06 billionyuan.

Meanwhile, the county was also found to have fakedinvestmentdata.

Companiescomplainedthatiftheydidnotfraudulentlyreporthigherdata, theirreportswouldbereturnedbylocalgovernmentdepartments. They also said that fake reports would ensure they would enjoy favorable policies such as securing bank loans.

The NBS said that the misconducthasseriouslyaffectedtheauthenticityandindependenceofcompanydata.

The NBS did not specify the reasons behind the county’s faking of data but it is a well-known fact that localgovernmentleadersareassessedfortheirperformancesbasedoneconomic data. Nice-looking data sheets mean promotion opportunities.

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