NBS to scrutinize 'optimistic' GDP data

By Kang Juan

With more eyes on economics amid the global downturn, the spotlight turns to a joint meeting of all provincial assessment officials today in Wuhan, Hubei Province, where they will scrutinize and confirm national gross domestic product (GDP) figures from the third quarter.

And those figures, analysts say, look very promising.

"The meeting is largely an occasion for the NBS to coordinate with its local organs on the initial results of regional GDP calculations," said Tian Yun, vice president of the China Macro Economics Institute. "This is an effort to narrow the gap between NBS' national data and the total sum of local figures."

Tian noted that this meeting takes place amid mounting pressure from the public and some international agencies over the authenticity of China's key economic indicators.

An NBS spokeswoman told the Global Times Sunday that the meeting is "aimed at ensuring the authenticity and accuracy of the figures." Such prudence helps prevent doctored books and illegal payouts. The meetings have taken place quarterly since 2004.

National economic data, including third-quarter GDP, will be revealed Thursday.

Initial figures disclosed by Beijing, Anhui and Henan authorities showed that their local economies are likely to expand 9 percent, 12.4 percent and 9.3 percent, respectively, in the July-September quarter, the 21st Century Business Herald reported.

Mao Fengzao, director of the Hubei Bureau of Statistics, said Wednesday that the provincial economy of the third quarter is significantly better than the first half of this year, which means GDP growth in the last three months will exceed 11.3 percent.

But an unnamed NBS official quoted by the paper said that many figures reported by local governments seem too high, so the numbers will be checked carefully.

"The bureau will check and adjust the GDP figures at the meeting according to local electricity consumption, fiscal revenue and tax revenue," he was quoted as saying.

The third-quarter GDP will have enjoyed a relatively higher level of authenticity, due to the remarkable rise of some key industrial indicators, said Yuan Gangming, a senior economist at the Economics Institute of the Chinese Academy of Social Sciences.

National power consumption, which only turned positive in June after negative growth for eight months, registered a 10.24 percent year-on-year growth in September, and the real estate prices in 70 Chinese cities rose 2.8 percent, year-on-year, the same month.

"Power consumption is a key economic barometer which should normally be consistent with GDP firgures," Yuan noted.

The NBS heard significant public outcry over the accuracy of its figures in July, when it reported that the country's GDP grew 7.1 percent, year-on-year, in the first half, to 13.99 trillion yuan ($2.05 trillion).

However, the aggregate GDP of the data reported by the provinces nationwide was 1.4 trillion yuan more than the 13.99 trillion, or 9.9 percent higher.

Government data showed that when provinces, autonomous regions and municipalities nationwide reported their first-half economic statistics, 24 localities' GDP growth rates were greater than the national average, and one locality was on a par with the national level.

"Local statistics organs are subject to the direction of local authorities, whose work performance is mainly evaluated by GDP growth," Yuan said.

Applying the output of large multi-regional enterprises toward the GDP of more than one province, the different assessment standards used by the NBS and local bureaus are two more major reasons for the big difference in figures, according to Peng Zhilong, director of the NBS' national economy assessment department.

"In China, the provinces are ranked by their GDP, and any change to that ranking can be very sensitive to local officials. It is possible that a few provinces overstate their economic situation," Peng said in August.

Analysts said GDP is a key statistic in the central government's judgment of the overall economic situation, and the data's authenticity is instrumental in helping the central government formulate macroeconomic management policies.

"The central government may not be duped by seemingly good numbers reported by local authorities when formulating economic policies, but those figures will mislead economic analysts and enterprisers," Yuan warned.

The discrepancy this past quarter won't be as big as the 9.9 percent seen in the first half of the year, Tian said.

The NBS, whose calculations are based on data provided by local authorities, should be the only agency in the country to carry out official GDP calculation through scientific procedures that might not be feasible within some regional governments, Tian said.

Qiu Wei, Guo Qiang and Zhang Han contributed to this story

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