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People's Daily Online>>China Business

NBS exposes gov't data fabrication

(Xinhua)

08:20, March 23, 2012

BEIJING, March 22 (Xinhua) -- The National Bureau of Statistics (NBS) recently stated that two local governments have allegedly manipulated business statistics, creating a challenge for China's goal of enhancing the credibility of its economic data.

In one statement posted on its website, the NBS said the Yongchuan district government in southwest China's municipality of Chongqing had ordered local companies to submit data to them for evaluation before registering with the NBS.

In another case, companies in the city of Hejin in Shanxi province were asked to report to the NBS using figures provided by a local statistics bureau.

The NBS has accused the two governments of violating the Law on Statistics, as well as a recent ruling that requires companies to report data directly to the central statistics authority.

According to the NBS, the government of Yongchuan has worked to eliminate the order, while the chief of the statistics bureau in Hejin has been ousted following the exposure.

END OF DATA COUNTERFEITING?

The manuevers made by the local governments have trained the spotlight on a new system introduced to ensure data accuracy, casting doubts over its impact on the perennial problem of data falsification in China.

Starting February, the NBS has required 700,000 Chinese enterprises to report their economic information, including their output, sales revenues and investment, directly on the NBS website.

Li Qiang, vice head of the NBS, said the measure was aimed at raising the quality and efficiency of data collection, which traditionally goes through multiple levels of local administration before being read by central statisticians.

Many believe that the procedural shortcut could prevent local officials from tampering with the data, which they tend to overstate to create a favorable depiction of the local economic situation.

Zhang Huaming, an economist at the Shanxi University of Finance & Economics, said the new system has made fabrication harder to conceal. Company bosses who were upset about being ordered to forge data might have engaged in whistleblowing in order to uncover the fabrications seen in Yongchuan and Hejin, he said.

"Without the new system, the fabrication could have been done behind the closed doors of local governments and never been exposed," Zhang said.

Yet Zhang remains cautious about the system's ability to completely wipe out statistical manipulation, as the economic and political motivation for doing so remain abundant in local Chinese governments.

"The key lies in the transition of mechanism and mentality. Data fabrication will continue until China decreases the importance of GDP in assessing local officials," Zhang said.

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