China said this week its economy grew 6.9% last year, the slowest rate since 1990. The data looks even grimmer when you analyse China’s GDP performance in US dollar terms. By this measure the economy actually shrank.
According to the World Bank the GDP of China at the end of 2014 (at then exchange rates) was $10.35 trillion. According to Chinese official statistics, at the end of 2015 China’s GDP stood (in local currency terms) at Rmb67.67 trillion. Using current exchange rates that equates to $10.28 trillion. This outcome is obviously the result of the depreciation in China’s currency in 2015 versus the US dollar.
Want a rosier perspective? In local currency terms China’s GDP in 2014 was Rmb63.64 trillion. So in absolute terms it added Rmb4.03 trillion. Given all the discussion about the economy’s performance in 1990, the size of China GDP in that year was just Rmb1.87 trillion. That means China’s output gain last year was more than twice the size of its total economy in 1990.
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