According to official Customs and SAFE data, China ran a goods trade surplus of $593 or $576 billion but according to bank payment and receipt data, China ran a goods trade surplus of only $128 billion.  If we include service trade, the picture worsens considerably.  China via SAFE trade data reports a $207 billion trade deficit in services trade.  Payment data reported via SAFE actually reports about $42 billion smaller deficit of $165 billion.  In other words, the supposed trade surplus of $600 billion has become a trade in goods and services deficit of $36 billion.  Expand to the current, through a significant primary income deficit, and the total current account deficit is now $124 billion.

... this sheds new light on the state of Chinese finances and RMB outflows. For instance, the differential between Customs and bank data reveals rising outflow discrepancies since 2012. While many have begun to worry recently about rising pressure on the RMB, it is clear that outflows from China are long lasting, large, and completely domestically driven... Consequently, calls for "temporary capital controls" or attributing it to a recent increase in outward direct investment reveal a profound misunderstanding of what the problem is. There is nothing temporary, foreign, or speculative about RMB outflows. In fact, quite the opposite. It is domestically driven long term capital flight which should change the framework of what solutions are called for in managing RMB policy.

... PBOC Governor Zhou Xiaochuan was very careful to say that China ran a "surplus in the trade of goods" rather than current account, trade surplus, or payments and receipts for international trade. Many foreign and Chinese agencies and analysts confuse these multiple categories referring to them as one category but they are not. His mention indicates he likely understands how capital is leaving the country and why capital controls would be a poor remedy which is also indicated.

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