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China to issue unified local, national GDP numbers amid data scepticism

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By Reuters
China to issue unified local, national GDP numbers amid data scepticism
FILE PHOTO: A man cycles outside the construction sites in Beijing's central business area, China January 18, 2019. REUTERS/Jason Lee   -   Copyright  JASON LEE(Reuters)

BEIJING (Reuters) – China will unify the way it calculates provincial economic output from early 2020, the National Bureau of Statistics said, amid scepticism about the reliability of Chinese data.

The statistical bureau will lead the data reform by formulating the method for calculating gross domestic product (GDP) and standardising a unified accounting system before publishing the results, Ning Jizhe, head of the National Bureau of Statistics, said in a statement.

“Implementing the reform of unified accounting of regional GDP is an inevitable requirement to improve the quality of data and the credibility of government statistics,” Ning said.

The combined GDP of China’s provinces has long exceeded that of the national level compiled by the bureau, raising suspicions that some growth-obsessed local officials have cooked the books.

Some economists believe China’s economic growth numbers have been somewhat overstated. Capital Economics analysts are forecasting 5.2% growth for 2019 versus Beijing’s expectations for just over 6% growth.

In 2018, the difference between gross domestic product reported in aggregate by China’s 31 provinces and the national GDP was at 1.44 trillion yuan (£160.90 billion), roughly equivalent to the GDP of New Zealand.

The government has stepped up a crackdown on data falsification and has been working towards unifying the accounting systems used by national and local authorities.

Chinese leaders have set new standards for local officials, stressing that their performance cannot be simply based on regional growth rates, but should include resource and environmental costs, debt levels and work safety.

It remains unclear on how the reform will affect GDP growth figures. Economic growth is currently running near a 30-year low of around 6%.

Data earlier Thursday showed China’s industrial output grew significantly slower than expected in October, as weakness in global and domestic demand and the drawn-out Sino-U.S. trade war dented the world’s second-largest economy.

(Reporting by Kevin Yao and China Newsroom; Editing by Shri Navaratnam)