China has a massive "tourism deficit" — the difference between the money that tourists spend in China and the money that Chinese people spend abroad: $206B from June 2015-June 2016, up from $77B in 2013. The missing money is hard to explain, since China doesn't export that many tourists.
But there's one explanation that fits the facts, according to Bloomberg: Chinese millionaires going abroad with "suitcases full of cash," which they convert to overseas real-estate, undeclared luxury goods, or just anonymous deposit accounts in offshore banks. Chinese corruption has hit surreal levels: for example, one civic official had so much cash in his apartment that the police who raided him were unable to count it with bill-counting machines. Instead, they weighed it by the ton and estimated its value by weight.
The shift of Chinese demand for foreign goods and services to foreign property and bank-accounts is bad news for the global economy.
Because China doesn't have a completely open financial account, some outflows would naturally be disguised as something else, he says.
China has been grappling with outflow pressures since mid-2014, when it became clear the yuan's multi-year appreciation bet was over.
Outflows peaked late in 2015, with companies fudging trade receipts to shovel money out, or buying overseas assets. That spurred intervention to support the currency and efforts to enforce restrictions on how much money Chinese people can move abroad.
Explaining the gap in tourism spending, Setser said it looks like the Chinese data "is capturing something different from what it was intended to capture."
(via Naked Capitalism)