The document discusses China's use of subsidies to support its economic planning and key industries. It notes that China lacks transparency in its subsidy programs and economic data, making it difficult to analyze the true efficiency and productivity of industries and gauge compliance with WTO agreements. The country's 11th Five-Year Plan indicates subsidies will continue flowing to strategic emerging sectors like renewable energy and to traditional industries competing with Western companies. While some foreign multinationals have found success in China, overall profit margins there tend to be lower than in other markets due to challenges around unreliable economic data provided by China.

1. Chinese Economic Planning and the Role of Subsidies Usha C. V. Haley, PhD Hearing on China’s WTO Compliance and Industrial Subsidies US-China Economic and Security Review Commission

2. April 4, 2006 Usha C. V. Haley, Statement before US-China Economic and Security Review Commission

6. Where India Trounces China April 4, 2006 Usha C. V. Haley, Statement before US-China Economic and Security Review Commission

12. Successful companies in our research did not rely on Chinese economic and industrial data “ You manage by objectives, objectives that must be clearly stated – then determine what kinds of tools you can use to determine if you achieved them, but stick with your objectives. However, if it comes to financial figures, it will be challenging. What good will numbers be if the base rates used for comparison of performance are not reliable.” Elmar Stachels, Bayer, China