Draw your brakes

Hold on there, high rollers. The easy money that greased the wheels of China’s economic engine in the first quarter may be drying up: While official numbers haven’t been released, state media are quoting “industry insiders” as saying bank lending in April fell sharply, to US$87.85 billion. Massive lending – new renminbi-denominated loans worth US$670 billion were doled out in the first quarter – had led to concerns about what exactly was being done with that money. (Not to put too fine a point on it, but that huge rise in lending did happen to coincide with suspiciously good performance on the domestic stock market.) But as bank lending fell in April, other numbers were moving in the other direction. General Motors announced that its unit sales in April had increased by 50%, setting a new monthly record. It had been helped by the reduction of a the purchase tax on new vehicles with engines smaller than 1.6 liters. Sales were particularly strong for the microvans built by its joint venture operation, Wuling, typically piloted in Shanghai by out-of-town drivers with little regard for traffic laws. China also seems so far to have little regard for the complaints of Canadians, upset over the detention of Canadian students and a ban on Canadian pork products. Both measures are part of Beijing’s ongoing effort to prevent swine flu from entering mainland China; the government has also established a US$733 million fund to stop the spread of the disease.