SHANGHAI, June 14 (Reuters) – Fake invoicing inflated
China’s official import and export totals by $75 billion in the
first four months of 2013, local media reported on Friday,
citing an internal review by China’s commerce ministry.
An alternate estimate found that actual year-on-year export
growth for January to April was only around 7
percent, while import growth was about 6 percent,
the 21st Century Business Herald reported, citing an
unidentified source and an internal commerce ministry document.
The second estimate was based on excluding data from the
port of Shenzhen, where much of the fraud is suspected to have
occurred.
Evidence has been growing in recent weeks that the world’s
second-largest economy is fast losing momentum, but suspect
trade data has clouded the picture for global investors.
China’s customs administration officially reported export
growth of 17.4 percent in the first four months of the year,
while imports officially grew 10.6 percent.
But analysts widely suspected that the data was distorted by
inflated invoices used to circumvent China’s strict capital
controls and profit from appreciation of the Chinese currency.
Reported trade growth nose-dived in May, with exports rising
only 1 percent and imports falling 0.3 percent.
The sharp drop occurred after China’s customs agency
promised to probe inconsistencies between China’s export data
and data on Chinese imports published by trading partners such
as Hong Kong.
China’s foreign exchange regulator also issued new rules in
early May strengthening oversight of trade invoicing.
The $75 billion estimate was based on an examination of
logistics data from China’s special customs regulation zones.
Such zones are the site of China’s bonded warehouses, where
analysts suspect much of the fake invoicing occurred.
Bonded warehouses are physically located inside China, but
domestically-produced goods stored there have already cleared
customs and are therefore counted as exports.
Imports and exports to and from the special regulation zones
increased by 130 percent year-on-year in January through April,
compared to only 19.1 percent in May, after tighter oversight
began.
Assuming the true growth rate for January through April was
similar to the reported growth rate in May produces an estimate
of $75 billion in fake trade. That compares to official data
showing combined imports and exports totaling $1.33 trillion in
the same period.
