GDP may top 10% next year

09:05, December 08, 2010      

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A report from the ChineseAcademy of Social Sciences (CASS), a Chinese think tank, predicted Tuesday the country's GDP will hit 9.9 percent this year and 10 percent next year.

But that projection is based on official statistics, which has been scrutinized recently over their accuracy.

The Asian Development Bank's biannual publication, the Asia Economic Monitor, which was released Monday, raised China's GDP growth from 9.6 percent to 10.1 percent for this year, and foresees 9.1 percent growth for 2011.

A slowdown in fixed asset investments and consumption this year led to the 9.9 percent GDP growth, said Zhang Tao, a CASS researcher and main author of the blue paper.

But the trade surplus in 2011 is expected to be slightly higher than this year contributing to the 10 percent uptick in growth, Zhang told the Global Times.

When quizzed on the source of the data, Zhang said that the projections are based on figures from the National Statistics Bu-reau. It is this data - and the methodology used to calculate it - that has drawn the attention of both the public and the me-dia. Reuters reported Tuesday that China's GDP figures are unreliable, citing a government official's remarks recorded in a confidential memo published by the WikiLeaks website.

"As China's GDP figures are reported by local governments to the National Statistics Bureau, some numbers may be inaccurate," Ye Qing, a professor with Zhongnan University of Economics &Law based in Wuhan, Hubei Province.

Ye should know as he is also deputy director of the Hubei Provincial Bureau of Statistics.

The problem derives from the data collection methodology and the data sources, he pointed out.

Currently, each province, municipality and autonomous region has a statistics bureau attached to the local government.

Local statistics bureaus calculate their own GDP figures and submit them to the national statistics bureau.

The country is trying to reform the methodology used, Ye said, adding that new calculation procedures could be implemented as early as the first quarter of 2011.

By then, local statistics bureaus will no longer be allowed to crunch their own numbers, and instead compute only those of their subordinates to prevent the falsification of the data, Ye noted.

But since the standard practice has been to measure local government performance by local GDP figures, the data source could still be misleading, he said.

A fundamental solution to this might be changing the local government's performance measurement from GDP growth to other measurements such as increases in local resident incomes, he noted.

Source: Global Times


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