In just over a year’s time China will finally achieve what other countries now take as routine – the national collection and compilation of economic statistics.
At the moment China does have a National Statistics Bureau, but data collection is also done at a regional or provincial level, as well as the production of data for each area that at times does not match the quality or the accuracy of the national figures.
Australia and NZ for example have had robust centralised statistical organisation for decades – the US has several major groups such as the Bureau of Economic Analysis, the Bureau of Labour Statistics, the Census Bureau, the Energy information Administration as well as data from government departments. France and Germany and the EU also have strong single statistical group.
This divergence in China between the central data on say GDP, and the state produced estimated quiet often were at considerable variance which led to foreigners often deriding the speed and accuracy of China’s reports of its rapid growth in recent years, especially compared to the much longer time periods it takes offshore statistical agencies to produce similar data for their economies.
And then there’s the mismatch between what the National Statistics Bureau is reporting and what the sum of the provincial governments are also saying in their statistical releases.The gap has been narrowing, but the discrepancy between provincial GDP and the national figure was estimated at 2.76 trillion yuan ($US401 billion) last year.
In fact the current system has long seen the unlikely situation that the combined economic output of China’s provinces has long exceeded national output measured by the NBS which has fuelled much of the foreign scepticism.
But no longer and in a quiet announcement in China this week (http://www.chinadaily.com.cn/business/2017-10/31/content_33930890.htm) revealed that China’s National Bureau of Statistics will take over data collection at the regional level from 2019.
National Bureau of Statistics Deputy Head Li Xiaochao said there had been significant improvement in the long-standing discrepancy between national and regional GDP data and the central government had increased inspections of potentially fraudulent data and was working towards unifying the accounting systems used by national and local authorities.
“The problem of discrepancy between regional and national GDP data has significantly improved, but (the gap) is still large,” Li said in an interview with China Information News that was published on the statistics bureau’s website on Monday.
“This situation is not conducive to accurately understanding regional economic trends, scientifically implementing macroeconomic controls, and impacts the credibility of government statistics,” Li said.
Li said the NBS will work with regional statistics agencies to compile regional data, with national and regional data to be released together once the new system is in place. In other words the regional data will be made less important by being incorporated into the national figures which will then be released.
The statistics office said it would push forward inclusion of research and development spending into regional GDP data, and would research methods for calculating service output from owner-occupied housing as part of improving its statistical methods. Now that will be a big deal because from all reports the economic impact of owner occupied housing is not in the Chinese national accounts in a meaningful way.
But all this hasn’t answered a very basic question that western economists ask about Chinese data – whether it is a case of GiGo (Garbage In and Garbage Out as a result) in the production of the source data. To quote a well known cliche, only time will tell for this one.
