China Is Changing How It Reports GDP to Meet IMF's StandardBloomberg News
China needs international standards to join IMF's SDR basket
Officials revise down quarterly GDP numbers for last year
China is tweaking the way it reports quarterly gross domestic product data, paving the way for the nation to adopt an International Monetary Fund standard as it presses ahead with the goal of gaining reserve currency status for the yuan.
The new reporting method will create conditions for China to adopt the IMF’s Special Data Dissemination Standard and will better reflect short-term fluctuations in the economy, the National Bureau of Statistics said in a statement Wednesday. The IMF describes the SDDS, established in 1996, as "a global benchmark for disseminating macroeconomic statistics to the public."
Under the change, the NBS will now release its tally of economic output for each quarter, along with a cumulative reading. Formerly, it released quarterly economic growth rates, but didn’t specify the value of GDP for each three-month period on its own.
China has recently introduced a series of other technical policy changes to aid its bid to join the SDR basket of currencies, including allowing overseas lenders to buy and sell the yuan onshore for direct investments, publishing a currency reference rate five times a day, and permitting banks to set whatever deposit rate they like for terms longer than a year. Those moves came in addition to the shock yuan devaluation on Aug. 11 in a change that gave markets a bigger say in setting the yuan’s value.
"China needs to adopt international standards if its currency wants to become an internationally used reserve currency," said Li Wei, the China and Asia economist for Commonwealth Bank of Australia in Sydney. Increased transparency and compliance with international standards are the benefits of the new method, he said.
China’s statistics bureau had been in cooperation with the IMF, the United Nations and the Organisation for Economic Co-operation and Development to learn the newest international measures for compiling GDP data and after several years preparation felt now is the time to launch reforms, the statement said.
"It will internationalize our quarterly compiling measure so as to create circumstance for us to join SDDS," it said.
Other ongoing measures to improve the quality of economic data include a June vow by the statistics bureau to expand an employment survey that Premier Li Keqiang said he wants to be “authoritative.”
— With assistance by Yi Zhu, and Kevin Hamlin
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