Mainland statisticians win chance to earn credibility
Mainland economic statistics - long suspect by outsiders - could finally take a leap into credible territory.
A project by Paris-based Organisation for Economic Co-operation and Development (OECD) and the State Statistical Bureau (SSB) on the data sources and procedures used to calculate national accounts will be published by early next year.
The project is the result of a three-year initiative by the OECD to train mainland staff on how to collect reliable national accounts and make authoritative economic forecasts.
'A key part of the co-operation between the OECD and China is in statistics collection,' OECD secretary-general Donald Johnston said in his first visit to the mainland since he was appointed to the post in 1996.
He is in Beijing to meet with senior leaders, including Vice-Premier Li Lanqing, to help step up OECD's co-operation with the mainland after a visit to Xiamen to attend the annual Third China International Investment and Trade Fair.
An OECD official said the project involves training SSB staff to implement an internationally-agreed code of drawing up national macro-economic accounts, draft a set of leading economic indicators, and work the purchasing power parity of the Chinese currency.
Although Beijing announced its economy grew 7.8 per cent last year, few foreign analysts and economists believed the figure because of a widespread practice of cooking the books by provincial governments.
The distrust of mainland statistics also extends to data collected in other fields, making it almost impossible for foreign investors to accurately assess the size of the economy and the markets they are interested in.
'It is not so easy to transfer the code because there are aspects of the Chinese economy which requires aspects of the code to be adapted,' the OECD official said.
A key problem, for example, was that statistics collection tended to be decentralised, allowing an opportunity for some provinces to be lax in reporting.
'By applying these national accounts, you can have checks and balances because you will have income on one side, and outgoings on the other,' the official said.
The SSB is also keen to develop a set of composite leading indicators to give a more up-to-date picture on where the economy is heading.
'In this respect, the OECD is helping China to develop regional indicators because this is believed to be more useful than national indicators [due to] the size of its economy.' There will also be a business tendency survey on expectations of company prospects.
'We have found that in the transition from command economies to market-oriented ones, the business tendency survey has been an efficient way of assessing the current economic climate.' Mr Johnston said the OECD predicted the mainland - the world's largest economy in 1820 - would be restored to that position by 2020.
'Because of its size and rapid progress, China has become the most important economic partner of OECD countries outside the OECD membership,' he said.