Source: CD    Published: 2024-03-11

GDP data of China, the United States and other G7 countries for the year 2023 have now been published. This makes possible an accurate assessment of the economic performance of China, the US and other major economies — both in terms of China's domestic goals and international comparisons. There are two key reasons that this is important.

First, for China's domestic reasons, it is key to achieve a balanced estimate of China's socialist economic situation and therefore the tasks it faces.

Second, the US has launched a quite extraordinary propaganda campaign, including numerous straightforward factual falsifications, in an attempt to conceal actual international economic facts.

The factual situation is that China's economy, as it heads into 2024, has far outgrown all other major comparable economies. This reality is in total contradiction to claims in Western media. This, in turn, demonstrates the extraordinary distortions and falsifications in the US and other Western media about this situation. It confirms that, with a few honorable exceptions, Western economic journalism is primarily dominated by quite extraordinary 'fake news' rather than any objective analysis.

China's growth targets

Starting with China's strategic domestic criteria, the country has set clear goals for its economic development over the next phase, which will complete its transition from a 'developing' to a 'high-income' economy by World Bank standards. In precise numbers, by 2035, it is entirely possible for China to double its total or per capita income. Such a result would mean China is decisively overcoming the alleged 'middle-income trap'.

In contrast, a recent series of Western reports, widely used in anti-China propaganda, claim that China's economy will experience a sharp slowdown and will fail to achieve its targets.

Self-evidently, which of these outcomes is achieved is of fundamental importance for China's entire national rejuvenation and construction of a modern socialist economy. But the outcome also affects the entire global economy. For example, a recent article by the chair of Rockefeller International, published in Financial Times, made the claim that what was occurring was China's 'economy… losing share to its peers'. The Wall Street Journal asserted: 'China's economy limps into 2024' whereas in contrast, the US was marked by a 'resilient domestic economy'. Daily Telegraph of London proclaimed China has a 'stagnant economy'. The Washington Post headlined that: 'Falling inflation, rising growth give US the world's best recovery', with the article claiming: 'in the United States … the surprisingly strong economy is outperforming all of its major trading partners'.

US use of fake news

Reading US media claims on these issues, and comparing them to the facts, it is impossible to avoid the conclusion that what is involved is deliberate 'fake news 'for propaganda purposes — as will be seen, the only alternative explanation is that it is disgracefully sloppy journalism that should not appear in supposedly 'quality 'media.

For example, it is simply absurdly untrue, and genuinely 'fake news', that the US is 'outperforming all of its major trading partners', or that China has a 'stagnant economy'. Anyone who bothers to consult the facts, an elementary requirement for a journalist, can easily find out that such claims are entirely false — as will be shown in details below.

Factually, the US Bureau of Economic Analysis, the US official statistics agency for economic growth, reported that the US GDP in 2023 rose 2.5 percent. By comparison, China's GDP increased 5.2 percent. But a series of US media outlets, starting with The Wall Street Journal, instead proclaimed that the 'US economy grew 3.1 percent over the last year'.

This fake news regarding US growth was created by statistical cherry-picking, in this case comparing only the last quarter of 2023 with the last quarter of 2022, which was an increase of 3.1 percent, but not by taking GDP growth in the year as a whole 'last year'. But US growth in the earlier part of 2023 was far weaker than in the fourth quarter — year-on-year growth in the first quarter was only 1.7 percent and in the second quarter only 2.4 percent. Taking into account this weak growth in the first quarter of the year, and stronger growth in the second, US growth for the year as a whole was only 2.5 percent — not 3.1 percent.

As it is perfectly easy to look up the actual annual figure, which was precisely published by US statistical authorities, it is hard to avoid the conclusion that this was a deliberate distortion in the US media to falsely present a higher US growth rate in 2023 than the reality.

It may be noted that even if US GDP growth had been 3.1 percent, then China's was much higher at 5.2 percent. But the real data make it transparently clear that China's economy grew more than twice as fast as the US in 2023 — showing at a glance that claims that the US is 'outperforming all of its major trading partners', or that China has a 'stagnant economy' were entirely fake news.

China has continued to far outgrow the US economy not only in 2023, but in recent years. China's outperformance of other major Western economies in the G7 is even greater that of the US.

Entirely misleading claims regarding such international comparisons, used for propaganda as opposed to serious analysis, are sometimes made because data are taken from extremely short periods of time that are taken out of context — examples of unrepresentative statistical cherry-picking. Such a method is not only erroneous, but it is particularly so during periods which were affected by the impact of the COVID-19 pandemic as it caused extremely volatile short-term economic fluctuations related to lockdowns and similar measures.

Growth comparison

It was already noted that in 2023 China's GDP grew by 5.2 percent and the US GDP by 2.5 percent, with China's economy growing more than twice as fast as the US. But it should also be observed that 2023 was an above-trend growth year for the US — US annual average growth over a 12-year period is only 2.3 percent and over a 20-year period is just 2.1 percent.

Therefore, although last year China's economy grew more than twice as fast as the US, that figure is actually somewhat flattering for the US. In the overall period since the beginning of the pandemic, China's economy has grown by 20.1 percent and the US by 8.1 percent, meaning China's total GDP growth since the beginning of the pandemic was two-and-a-half times greater than the US.

Turning to wider international comparisons than the US, such data immediately show the extremely negative situations in most Global North economies and China's great outperformance of them.

In the four years to the fourth quarter of 2023, covering the period since the beginning of the pandemic, China's economy had grown by 20.1 percent and the eurozone by 3 percent. China's economy, therefore, grew by two-and-a-half times as fast as the US over the period, while the situation of the eurozone could accurately be described as extremely negative with annual average GDP growth in the last four years of only 0.7 percent.

Such data again make it immediately obvious that claims in the Western media that China faces economic crisis, and the Western economies are doing well, are entirely absurd — pure fantasy propaganda disconnected from reality.

An analysis of individual countries, then comparing China to all G7 states, that is, the major advanced economies, show the situation equally clearly. Data for China and all G7 economies have now been published for the whole of 2023. The huge outperformance by China of all the major advanced economies is again evident.

Over the four years since the beginning of the pandemic, Canada's GDP grew by 5.4 percent, Italy by 3.1 percent, the UK by 1.8 percent, France by 1.7 percent, Japan by 1.1 percent and Germany by 0.7 percent.

Over the same period, China's economy, therefore, grew almost four times as fast as Canada, almost seven times as fast as Italy, 11 times as fast as the UK, 12 times as fast as France, 18 times as fast as Japan and almost 29 times as fast as Germany.

A GDP comparison using the IMF's January 2024 projections shows that from 2019 to 2023, China grew by 20.1 percent, India by 17.5 percent, Brazil by 7.7 percent, Russia by 3.7 percent and South Africa by 0.9 percent.

The outperformance by China immediately shows why it is extremely misleading when proposals are made that China should move toward the macroeconomic structure of Western economies. If China adopts the structure of a Western economy, then, of course, China will slow down to the same growth rate as that of Western economies.

The writer is a British economist and senior fellow at the Chongyang Institute for Financial Studies, Renmin University of China.