---Figure revision in the first national economy census

China's first national economy census last year reassessed China's GDP growth in 2004 as 16.8 percent bigger than the previously announced figure of 13.7 trillion RMB (1.7 trillion USD). With the new figures, China replaced Italy as the world's sixth-biggest economy last year, and its economy was on the verge of overtaking Britain's.

Later, Guangdong also announced its revised GDP for 2004, which reached 1.886 trillion RMB (0.234 trillion USD), gaining 17.6 percent from the previously reported figure of 1.604 trillion RMB. Guangdong still occupied the largest share of the country's GDP after the figure revision. The agriculture sector's contribution to the province's GDP was lowered by 2.1 percent or 2.59 billion RMB, while the figures of the industrial sector and tertiary industry were increased by 4.4 percent and 41.7 percent, or 39.04 billion RMB and 246.03 billion RMB respectively,

On this year's provincial people's congress held in February, Governor Huang Huahua delivered a work report, saying the province's GDP exceeded 2.17 trillion RMB in 2005, with a year-on-year increase of 12.5 percent. The local governments of Guangdong are expected to book revenue of 180.60 billion RMB. The province's nine pillar industries and hi-tech product manufacturing sector booked value added of 610.8 billion RMB and 202.6 billion RMB, up by 20.3 percent and 20.6 percent respectively as compared to 2004. The export went up 24.3 percent to 238.16 billion RMB. Rural economy saw a booming year as the large industries' value added and fiscal revenue of the province's 67 counties were 72.4 billion RMB and 12 billion RMB, increased by 22.1 percent and 20.5 percent respectively. And earlier this year, there was a forecast that Guangdong's GDP in 2005 was to surpass that of Singapore and Hong Kong.

Revised Figures

Last year, there were reports that Shandong's industrial development had surpassed Guangdong's. There was even forecast that Shandong's economy would overtake Guangdong's sooner or later. The census raised Guangdong's GDP figure and lowered Shandong's, which sharply widened the GDP performance gap from the previous announced 54.88 billion RMB to over 380 billion RMB between the two leading provinces. The new data showed Guangdong, with a vast growth contributed by its SMEs, outdid Shandong in industrial value added services. But it lost to Shandong in large enterprise performance.

The province's service sector gained 95 billion RMB in the survey and the province's three-pronged economic make-up including agriculture, industry and tertiary industries, was adjusted from 7.8:55.4:36.8 to 6.5:49.2:44.3. According to a report that was released by the Statistics Bureau of Guangdong Province in January, the province's agriculture, industry and tertiary industry output in 2005 were 137.46 billion RMB, 1074.73 billion RMB and 957.94 billion RMB, up 3.2 percent, 15 percent and 10.8 percent over the year 2004 respectively.

In the year 2000, the last year of the "ninth five-year plan" period (1996-2000), Guangdong's GDP exceeded 1 trillion RMB for the first time. And in 2005, the last year of the "tenth five-year plan" period (2001-2005), Guangdong booked an annual GDP exceeding 2 trillion RMB. It took only five years for the province to double its GDP and after 26 years of rapid development, Guangdong's share of the national economy rose from 5.1 percent in 1978 to 11.9 percent in 2005.

Unchanged Plans for 2006-2010

According to Bo Xinmin, Director of the Provincial Bureau of Statistics of Guangdong, provincial leaders will not make big revisions of its development plan for the next five years after the survey. According to the survey, several limiting factors in the province's development still exist such as structural problems. In the coming "eleventh five-year plan" period, Guangdong plans to maintain a steady growth rate, about 9 percent annually, while putting more effort on development mode switches and social problems that accompany rapid economic development.
However, further economic plan revisions will use the survey results for reference. Provincial planners are going to launch several large projects in 2006 in order to maintain its development momentum, said Bo.

What do the GDP gains means?

The main reason for the GDP gains in Guangdong and the country as a whole is due to the adoption of updated scientific methods in conducting the first national economic census. Many emerging service industries and self-employed businesses were included in economy measuring for the first time in the census. Figures after the revision, especially the figures related to the private sector and the tertiary industry, are more credible. More than two trillion RMB out of the 2.3 trillion RMB gain of the country's GDP comes from the tertiary industry. Guangdong's service industry output has also made considerable gains.
 
Secondly, since the new figures are more credible, all levels of governments now have a clearer picture of the local economy. Especially, the planners now know better about the tertiary industry's important contribution to the overall economic development. This helps them to plan better development strategies in the future.
 
Also, the 30 million immigrants, who have made a significant contribution to the province's economy, were not counted when measuring the per capita GDP and other per capita indicators. That means all the per capita figures of the province in the census were considerably overstated. There will be still lots to do before the residents and immigrants in the province can live a well-off life.

Moreover, the figures' adjustments do not bring tangible changes. The change in economic make-up does not mean that the province has shaken off its high-energy-consumption and high-pollution development mode. A shortage of coal, electricity and oil in recent years and the newly added shortage of technical workers and water last year have pushed the province to find a path towards sustainable development.

Lastly, the new figure showed that Guangdong was still far ahead of every province or region else in the country in term of overall economic performance, but in the past few years it has also faced with increased pressure from some provinces, such as Shandong, Jiangsu and Zhejiang, which showed a strong momentum to catch up with or surpassing it in several aspects, including attracting foreign direct investment and industrial sector's performance. Therefore, the province's main concern is to maintain its position as the nation's leading economic growth region and "Learning from the rivals" has become a guideline for the provincial officials when they are doing development planning.

The proposal to the "eleventh five-year plan" approved in a Guangdong provincial Party Committee meeting last October called on acceleration in six areas in the coming five years including development mode switch, innovative capacity building, structure reform and opening up, balancing the developments of urban and rural areas, Green Guangdong project and Harmonious society building project. The "scientific development" concept will continue to guide Guangdong in its future economic growth.

Editor: Yan