China Research

The main content of this blog article is not really new. I have been pointing several times before at the insufficiencies of Chinese economic statistics, both in this blog and in published articles – despite obvious statistical improvements in recent years.

We should not, however, judge the shortcomings of Chinese statistics from a position of Western arrogance. In the 1980s, the U.S. had a marked downsizing of statistical quality – a downsizing process that then, fortunately, was successfully combated with all thinkable energy, for example, by NABE’s (National Association for Business Economics, Washington D.C.) statistical front woman Maureen Haver. Furthermore, it is still not very unusual that major statistical revisions happen even in developed countries considerable time after the first publication date. Not to talk about the poor quality of Greek statistics before the eruption of the crisis!

We should understand that China in a statistical sense rather can be described as a whole continent than a single country. The gigantic size of China makes it certainly difficult to make necessary surveys really representative and to single out the appropriate methods for different calculations. That’s the side of the coin that should make us humble. On the other hand: China could do much more about statistical transparency and the quality of statistical publications.

For foreign analysts who are not able to read Chinese characters, the “Statistical Communiqué of the People’s Republic of China on the 2012 National and Economic Development” should be the most interesting source to find a summary for the previous year (without in this context considering the quality of the quoted different statistical indicators). But there are obviously statistical weaknesses that quite easily could be eroded.

For example, distinctions between nominal and real numbers are not always clear (which goes back to the old system with its references to nominal changes). Average numbers and year-on-year comparisons are not singled out sufficiently. GDP calculations do not show systematically the usual components from the expenditure side. Different price deflators in the national account cannot be found in the above-mentioned statistical summary (which I would be very keen to know more about, likewise a split into private and public consumption). Further shortcomings could be mentioned.

But we get informed on other issues which may be quite interesting. Some examples for 2012 are given below according to the latest official statistics (without real knowledge from my side about the size of underestimations or overestimations):

– total population: 1 354 million (male share 51.3 percent)
– urban population: 52.6 percent (=share in 2012; +1.3 percentage points      compared to 2011!)
– employment: 767 million (of which 152 million in unemployment insurance     programs)
– total number of migrant workers within China: 263 million
– annual per capita income, rural : 7 917 yuan (RMB, about 1250 USD)
– total GDP: 51 932 million yuan (+ 7.8%; value shares agriculture 10.1,    industry 45.3, services 44.6)
– R&D: 2 percent of GDP
– Chinese direct investment abroad: 77.2 billion USD (+ 28.6 percent;    FDI into China: 111.7 billion USD)
– increase of savings (+14.1 percent) and increase of credits (+15.6 percent)
– CPI: +2.6 (for food +4. 8 percent)
– kindergartens (number of attending children): 37 million

To summarize: it should be an important commitment to the new Chinese leaders to strongly support increased statistical transparency and qualitative improvements. Both China itself and the whole (analytical) world would benefit from such a development in the second largest economy in the world.

Hubert Fromlet
Professor of International Economics
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