China plans to overhaul GDP accounting system
China is planning to overhaul the system used to measure the health of the world’s second-largest economy to bring it in line with global standards, the National Bureau of Statistics (NBS) said.
The country’s economic data has been widely criticised as being unreliable. Premier Li Keqiang has said China’s gross domestic product (GDP) was “man-made” and therefore unsound, according to US diplomatic cables released by WikiLeaks.
The proposed revisions would bring China’s accounting methods in line with the 2008 United Nations system of national accounts. The country's current version dates back to 1993, NBS vice-head Xu Xianchun told the official Xinhua news agency on Monday.
The new system, if implemented, would come online by the end of next year at the earliest, Xu said in the interview.
The changes would mean that spending on research and development would be counted as a form of fixed capital and therefore would be included into GDP calculations, Xu added.
China’s GDP data is closely watched by global markets.
In the first nine months of the year, the US$8.5 trillion economy grew 7.7 per cent from a year earlier, putting it on track to achieve Beijing’s growth target of 7.5 per cent this year, which would still be China’s worst performance in 23 years.
The proposed changes would also include new methods for determining the value for some self-owned housing, amend the calculation of farmers’ income and create an index for employee stock options as a form of labour wage.
Historical GDP data will also be revised according to new standards and released after the ongoing third national economic census, Xu said.