Liaoning government admits it falsified economic data

Chen Qiufa, governor of Northeast China's Liaoning Province, admitted that some local fiscal and economic figures between 2011 and 2014 were falsified and fraudulent, the People's Daily reported on Tuesday.

During the 8th meeting of the 12th People's Congress of Liaoning, Chen said that the province began to increase data accuracy in 2015, when financial revenue contracted 33.4 percent year-on-year. Last year, Liaoning's revenue rose 3.4 percent to 219.9 billion yuan ($32 billion), according to the report.

Since 2014, fiscal revenues and fixed-assets investment in Liaoning have declined.

But the economy probably looked great because of fake numbers for other economic and fiscal indicators, Liang Qidong, vice president of the Liaoning Academy of Social Sciences, was quoted as saying in the report.

For example, a county near Shenyang, capital of the province, reportedly announced fiscal revenue of 2.4 billion yuan in 2013, but after an audit the figure was reduced to 1.1 billion yuan, and this was not an isolated case.

"It's not only happening in Liaoning, but other provinces as well, as local governments are under pressure to show positive GDP figures. Those figures are part of their evaluation KPI system," Feng Liguo, an expert at China Enterprise Confederation, told the Global Times on Tuesday.

He noted that as the country is in a "new normal" phase of development, local authorities should attach more importance to quality rather than quantity.

"For example, numbers relating to factory bankruptcies, employment rates and capital outflow should be more fully disclosed," Feng added.