China to have Unified National and Local GDP Accounting Method from 2020
From 2020, the People’s Republic of China will revise the way it used to calculate the Gross Domestic Product (GDP) or the economic output data. Since 1985, different accounting methods have been adopted by the authorities at the local and national levels for formulating the GDP figures in China. The unification of the GDP numbers at the local and national will be under the new mechanism, the GDP figures from 2020 will be standardized by using a unique system before publishing the results, that will be based on the accounting system. The move comes amid the continued slowdown faced by the World’s Second Largest economy. During the second quarter of the 2019-20 financial year, China’s growth rate continued to face the impact of the slowdown due to the ongoing trade war with the United States, as the Chinese economy fell to an annual growth rate of 6.0 percent, their lowest since 1992.
The National Bureau of Statistics of China will lead the new mechanism by formulating methods for calculating the unified GDP. The unified GDP according to the authorities in China will close the national and regional discrepancies in the GDP figure. As per data available till last Thursday 26th December 2019, it remains clear that the Chinese Industrial Output has a growth rate significantly slower even as compared to October 2019 reports. The step taken by the Chinese government at this time is considered as a step to crackdown data falsification as per industry experts.