China's National Bureau of Statistics has accused a county government in southern China of faking economic data by coercing local companies to boost industrial output figures, state media have reported. Luliang county in southern Yunnan province pressured 28 local companies to report 6.34bn Yuan (£665m) of industrial output last year, while according to "initial calculations" the true figure was less than half of that, the state newswire Xinhua reported on Thursday night. "Companies complained that if they did not fraudulently report higher data their reports would be returned by local government departments," it said, citing a National Bureau of Statistics report. "They also said that fake reports would ensure they would enjoy favorable policies such as securing bank loans."
The county government itself reported fake investment data, Xinhua added. Analysts say that phony economic data is nearly ubiquitous in China, as officials are promoted based on their ability to present favorable numbers. "You have an incentive system that encourages the falsification of data," said Fraser Howie, the co-author of Red Capitalism: The Fragile Financial Foundation of China's Extraordinary Rise. "We known that for literally decades provincial GDP figures have never totaled the national GDP figures – you have a fundamental mismatch of those numbers." "Anybody who's working with Chinese statistics runs up against problems, inconstancies, and incomplete data," Howie added. "There are just black holes in information gathering." Howie said that while false data was a long-running national problem, Chinese authorities may launch selective crackdowns every few months to demonstrate vigilance. "It could be that this is a particularly egregious case, it could be that there's political infighting, it could be that this leaked somewhere else first," he said. He drew a parallel to President Xi Jinping's anti-corruption drive, which critics have dismissed both as lip service and as a political purge. "Its like the corruption thing – they're not going after nobody, but they're certainly not going after everybody," he said. "Yunnan is far away, nobody really goes there, nobody really cares. It's not like this happened right in Beijing, at the heart of things."
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"We face a systemic industrial massacre," said Antonio Tajani, the European industry commissioner.
Mr Tajani warned that Europe's quixotic dash for renewables was pushing electricity costs to untenable levels, leaving Europe struggling to compete as America's shale revolution cuts US natural gas prices by 80pc.
"I am in favour of a green agenda, but we can't be religious about this. We need a new energy policy. We have to stop pretending, because we can't sacrifice Europe's industry for climate goals that are not realistic, and are not being enforced worldwide," he told The Daily Telegraph during the Ambrosetti forum of global policy-makers at Lake Como.
"The loss of competitiveness is frightening," said Paulo Savona, head of Italy's Fondo Interbancario. "When people choose whether to invest in Europe or the US, what they think about most is the cost of energy."
A report by the American Chemistry Council said shale gas has given the US a "profound and sustained competitive advantage" in chemicals, plastics, and related industries. Consultants IHS also expect US chemical output to double by 2020, while Europe's output will have fallen by a third. IHS said $250bn (£160bn) in extra US manufacturing will be added by shale in the next six years.
Nuno Fontes In June, Italy's trade surplus widened to €3.62 billion from a surplus of €2.78 billion registered in the same month of 2012. This was due to weaker domestic demand as imports fell at a faster pace than exports.
In June, compared with the same month of the previous year, exports decreased by 2.7 percent (-2.8 percent for EU members and -2.7 percent for non EU countries) and imports fell 5.6 percent (-3.0 percent for EU and -8.7 percent for non EU countries). With European Union countries, Italy registered a trade surplus of €1.12 billion, compared with a surplus of €1.11 million in June of 2012.
In seasonally-adjusted data, compared to May 2013, exports were up by 1.2 percent and imports rose 1.6 percent. The increase in sales was the result of an increase of 3.8 percent for EU countries and a decrease of 1.7 percent for non EU countries. Purchases increased for both EU (0.9 percent) and for non EU markets (2.5 percent). Over the last three months, seasonally-adjusted data in comparison with the previous three months, exports rose 0.4 percent and imports dropped 2.1 percent.
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