China’s economy grew 0.4% in the just-completed second quarter, compared with the same period last year, according to the official National Bureau of Statistics.
According to almost everybody else, gross domestic product shrank in Q2. As Max Zenglein of the Mercator Institute for China Studies told the Washington Post before the announcement, “The government will not acknowledge a contraction.”
China’s economy not only contracted, but it is also heading for a free fall. Chinese leaders, for many reasons, cannot now stabilize the situation.
The Communist Party makes the case that trade will lift China toward the announced goal of “around 5.5%” growth for 2022. Two-way trade jumped 9.4% in the first half, year-on-year. Yet the economy is weak, something evident from the composition of trade. While exports skyrocketed 13.2%, imports, an indicator of domestic demand, increased only 4.8%.
