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Business / Economy

GDP will now rely on single-quarter data

By Zheng Yangpeng (China Daily) Updated: 2015-09-10 07:03

GDP will now rely on single-quarter data

Workers reinforce a bridge on the Yangtze River in Jiujiang, Jiangxi province. [Photo/China Daily]

China will calculate its quarterly GDP based on single-quarter data in an effort to measure short-term economic fluctuation more accurately, the National Bureau of Statistics said on Wednesday.

Beginning with the third quarter of this year, the NBS will figure the quarterly GDP based on raw data of that particular quarter, as opposed to the previous method in which statisticians used cumulative data.

For example, under the old system, statisticians would arrive at the third-quarter GDP by subtracting the cumulative GDP of the first half of the year from the cumulative GDP of the first nine months. Now they will directly collect primary data of the third quarter to get the result.

In a written Q-and-A format posted online, Xu Xianchun, deputy director of the NBS, said that the reform will more accurately gauge economic activities in a specific quarter and grasp short-term fluctuation in a more "agile" manner, thus offering a sounder basis for economic analysis and policy reaction.

The new reporting method will create conditions for China to adopt the International Monetary Fund's Special Data Dissemination Standard, he said. The IMF describes the SDDS, established in 1996, as "a global benchmark for disseminating macroeconomic statistics to the public".

Most developed countries measure quarterly GDP based on a specific quarter's data and compare it with the previous quarter.

China used the "accumulation-deduction" approach because the traditional accounting system is essentially "accumulation-based" and it is more difficult to collect primary data for a single quarter, Xu said. It took a few years for the NBS to prepare for the transition.

The move is part of a broader effort to bring GDP accounting more into compliance with the international norm. A major reform in 2011 enabled the NBS to release quarter-on-quarter GDP growth rate.

China started to release quarterly GDP data in 1992. Under the new method, the NBS has revised all GDP data back to 1992.

The reform came just two days after the NBS revised the country's GDP growth for last year downward by 0.1 of a percentage point to 7.3 percent.

Economist Intelligence Unit, a think tank, said the revision means a lowered base of comparison, and thus China will be more likely to meet its economic growth target of about 7 percent this year.

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