NBS moves to increase data transparency

14:17, April 17, 2011      

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China's National Bureau of Statistics (NBS) released four quarter-on-quarter economic indexes for the first time on Friday.

The move is aimed at changing what has been seen as a controversial statistic, and a step towards accepted international standards.

The bureau released a quarter-on-quarter GDP index showing a rise of 2.1 percent, indicating heated economic growth during the first three months of the year.

Some economic observers had previously argued that China's GDP measurement was not comparable with other economies, because the methods of calculation differed from those used in other countries. Many of the world's major economies use seasonally adjusted quarter-on-quarter economic growth as their main GDP indicator.

The method of calculation used by the US Bureau of Economic Analysis was clearly explained by columnist Tom Orlik in the Wall Street Journal like this: a figure of 3.1 percent for US economic expansion in the fourth quarter of 2010 is derived by taking quarter-on-quarter growth of 0.775 percent between the third and fourth quarters and multiplying it by four.

However, using China's previous method of calculation, the country's data showed that, in the first quarter of 2011, the world's second-largest economy expanded by 9.7 percent year-on-year.

The bureau has also started to provide seasonally adjusted month-on-month figures for added-value large industrial enterprises, fixed asset investment and total retail sales of consumer goods, according to Sheng Laiyun, an NBS spokesman.

"The new quarter-on-quarter figures can reflect short-term output changes, allowing policymakers to make timely adjustments to macroeconomic policy," said Sheng.

He said that calculation of the new indexes requires at least seven years' worth of data, which is "more sensitive", to show the economic development trend.

"The publication of quarter-on-quarter figures will be a definite step forward for China's economic data," according to the Wall Street Journal's Orlik.

In January, the NBS adjusted the weightings of the components of the consumer price index (CPI), raising the weighting of housing prices by 4.22 percentage points and lowering that of food prices by 2.21 percentage points.

Previous NBS adjustments to the weightings sparked controversy. Some analysts argued that the government might "abuse the scope for judgment to tweak the data in a harmonious direction", Orlik said in his column.

In March, Ma Jiantang, the head of the NBS, said the bureau will increase the transparency of the information it releases, and that the change in the method of calculation will help the government with policy decisions during the country's 12th Five-Year Plan (2011-2015).

Source: China Daily
 
 
     
 
 
 
     
 
 
 
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