China Censors Bad Economic News Amid Signs of Slower Growth

How’s this for why we need to protect a free press?

China Censors Bad Economic News Amid Signs of Slower Growth

New directives betray a mounting anxiety among Chinese leaders that the country could be facing a worsening slump as the trade war with the United States intensifies.

Warmly, Rob
China Censors Bad Economic News Amid Signs of Slower Growth
A market on the outskirts of Harbin, China.

By Sui-Lee Wee and Li Yuan

Sept. 28, 2018

China Censors Bad Economic News Amid Signs of Slower Growth

BEIJING — China has long made it clear that reporting on politics, civil society and sensitive historical events is forbidden. Increasingly, it wants to keep negative news about the economy under control, too.

A government directive sent to journalists in China on Friday named six economic topics to be “managed,” according to a copy of the order that was reviewed by The New York Times.

The list of topics includes:

■ Worse-than-expected data that could show the economy is slowing.
■ Local government debt risks.
■ The impact of the trade war with the United States.
■ Signs of declining consumer confidence
■ The risks of stagflation, or rising prices coupled with slowing economic growth
■ “Hot-button issues to show the difficulties of people’s lives.”

The government’s new directive betrays a mounting anxiety among Chinese leaders that the country could be heading into a growing economic slump. Even before the trade war between the United States and China, residents of the world’s second-largest economy were showing signs of keeping a tight grip on their wallets. Industrial profit growth has slowed for four consecutive months, and China’s stock market is near its lowest level in four years.

“It’s possible that the situation is more serious than previously thought or that they want to prevent a panic,” said Zhang Ming, a retired political science professor from Renmin University in Beijing.

Mr. Zhang said the effect of the expanded censorship strategy could more readily cause people to believe rumors about the economy. “They are worried about chaos,” he added. “But in barring the media from reporting, things may get more chaotic.”

The directive didn’t appear to affect run-of-mill daily coverage of economic data, which could still be widely found online in China on Friday. Instead, the directive appeared to be aimed at easing the overall tone.

Indeed, another notice sent on Friday instructed online news outlets to remove comments at the bottom of news articles that “bad-mouth the Chinese economy.”

These topics pertain to “China’s economic downturn,” “China’s stagflation,” “new refugees,” “consumption downgrading” and “other harmful remarks that criticize the development prospects of China,” according to a copy of the notice reviewed by The Times. Consumption downgrading refers to Chinese consumers looking for ways to spend less.

China’s propaganda department couldn’t be reached late Friday for comment.

Negative economic news could undermine the careful message Chinese officials have tried to transmit to the public in recent months. They have said that the country’s vast and growing ranks of consumers, as well as China’s increasing sophistication in technology and other areas, would help it weather any ill effects from rising American tariffs.

At the same time, officials have made moves to juice the economy. The government has loosened restrictions on big but costly local government projects like subways and light rail lines. It has also promised tax cuts for businesses and other efforts to generate more construction.

The trade war could certainly worsen the economic climate if it lingers, leading to job losses and even weaker consumer sentiment. But China has more deep-seated economic problems.

Officials are trying to clean up huge debts accumulated by local governments. Curbing debt could mean slower economic growth, as it deprives borrowers of the funds they would otherwise spend.

China has long maintained a tight grip on the media, though the economy traditionally has been one of the freer domains of reporting. Even after China began more closely managing its economic message following market turmoil in 2015, aggressive journalists have covered the fallout of peer-to-peer online lending schemes and the problems posed by local government debt, among other issues.

On paper, China’s gross domestic product, its main economic figure, indicates smooth sailing. But the figure is widely doubted, and many economists are forecasting a slowdown to varying degrees.

Mark Williams, chief Asia economist of Capital Economics, said the firm expects the Chinese economy to slow down to 5 to 5.5 percent from 6.9 percent last year. Despite the lower forecast, he stressed that it was “not a weak number” for the Chinese economy.

“One of the problems is there’s a lot of doubt about official Chinese data,” Mr. Williams said. “And when they come out with these directives, it just raises more questions.”

In the past year, domestic news media have had to write their stories on the economy with a gentler tone, said a journalist covering finance for a Chinese business newspaper, who asked not to be named because of the sensitivity of the matter.

Censors have also erased online commentary that contained the phrases “consumption downgrade,” taxes, debt and unemployment, according to the Journalism and Media Studies Center at the University of Hong Kong, which monitors censorship on Weibo, China’s Twitter-like social media service.

One post that was removed by censors said: “The bad news in the market is exploding, pessimistic viewpoints are spreading, many retail investors are in despair.”

Another read: “Will the emergence of robots free up labor or cause unemployment and poverty?”

The scrutiny over economic news adds to a broader pattern of the tightening of control over media since President Xi Jinping came into power in 2012. Particularly online, the Chinese government has centralized and beefed up regulatory agencies that monitor content. Recently, the agencies have come down harder on entertainment news and celebrity gossip, in addition to political and social issues.

On Wednesday, Phoenix News Media, a Hong Kong-based outlet with big operations in mainland China, said the Chinese authorities had instructed it to “rectify” its news portal, The Cyberspace Administration of China, the country’s main internet regulator, said that Phoenix had “disseminated illegal and harmful information, distorted news headlines and shared news information in violation of rules.”

Two weeks earlier, NetEase, an online news portal, said it had to suspend updating its financial platform “because of serious problems.”

Sui-Lee Wee reported from Beijing, and Li Yuan from Hong Kong