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China's Official Statistics: Challenges, Measures and Future Development
By Li Deshui, Commissioner of National Bureau of Statistics of China (3 March 3 2005)

Mr. Chair, distinguished panelists, ladies and gentlemen,

First I would like to thank the UNSD for inviting me to participate and make a presentation at this meeting. I am greatly honored to have this opportunity to share experiences and views with heads of national statistical agencies on issues concerning official statistics. In today's world, we see a stronger trend of global economic integration and fundamental changes in the economy and the society across countries. Official statistics is facing various challenges. In this connection, this meeting is important and relevant. My presentation today will focus on challenges that Chinese official statistics faces, our countermeasures and thoughts on future development.

I. Severe Challenges

At present, China is in a new era of development featured by the economic transition and building of a well-off society, aiming at accelerating the process of socialist modernization. The Chinese government has set forth the scientific concept of development focusing on human-centered comprehensive, coordinated and sustainable development. This new situation calls for new and higher requirements for official statistics, and huge challenges as well.

1) Transition in economic system and social structure and the high economic growth brought about huge and multi-dimensional pressure of requirements on statistics. On the one hand, some surveys and indicators that were developed during the central planning economy are still needed for the time being. On the other hand, there is an explosive demand for statistics from the new market-oriented economic system that requires statistical information to actually reflect the national conditions and strength, to record and describe the process of economic and social transitions, to report and monitor the performance of the economy, to collect and analyzed public opinions and views, and to depict problems in the course of economic and social development. The demand for statistical data is increasing from the public in general, who are more closely watching and using statistical information released by government statistical agencies. Timeliness of statistics becomes more important in addition to accuracy and comprehensiveness. In recent years, we have seen an increasing concern and demand from the international community for Chinese statistical data, as the Chinese economy is closely integrated with the world economy.

2) The environment in which statistical system operates has changed which has made it more difficult to conduct official statistics. China is experiencing fundamental economic and social changes. There are more stakeholders in the market, the way people invest, get employed, earn money and consume become diversified, economic structures and economic relations become more complicated, and disparities between regions, between urban and rural areas and between social clusters are more prominent. As a result, respondents of statistical surveys increased in folds, and changed frequently. They are more concerned with the protection of privacy and commercial confidentiality, and are less supportive and cooperative in surveys. Another unique issue in China is that sub-national or local statistics are used as yardstick to measure the performance of local governments in promoting economic and social development of the region. Statistics are at the risk of manipulation by local authorities. All these make it more and more difficult to organize statistical surveys.

3) As the international society pays more and more attention to the economic development of China, some suspicion and questioning on Chinese statistical data emerged. Over the past 26 years, and average annual growth of the Chinese economy reached 9.4%. Such a high growth has indeed attracted the attention of the world. With common professional rules and practices, our colleagues in the international statistical community never made comments on Chinese official statistics. However, there were some other people who seemed like to make stories out from Chinese official statistics. For instance, at one moment, they cooked up the theory of "China threat", on another occasion, they advocated "the collapse of the Chinese economy" by claiming that Chinese statistics were not true. Some even laid ungrounded censure on Chinese official statistical agencies. Therefore, it becomes a major challenge for Chinese official statistical agencies to improve the transparency of statistical work to remove such suspicions, and to maintain the integrity of Chinese official statistics.

II. Consistent Measures

The Chinese government statistical agencies adopted various measures in recent years to face the challenges and to meet the demands for statistics.

1) Reforming the national account system and improving the quality of national and regional account data At present, we are implementing the National Economic Accounting System of China 2002, which is based on the 1993 SNA of the United Nations, and is integrated with the internationally accepted standards and rules. We have revised the procedures and publications of GDP data, which now involves three steps of preliminary estimates, verified estimates and final figures. We have established a system for the joint evaluation of provincial and local GDP data, under which provincial GDP figures are to be authorized by the National Bureau of Statistics for release as official data after joint evaluation. To increase the transparency of compilation, an advisory group has been established that consists of external experts on national accounts, who will provide their views on the GDP data on quarterly basis. I can say with my full responsibility that national accounts data released by the National Bureau of Statistics of China are reliable and they reflect the general level and trend of development of the Chinese economy.

2) Establishing scientific system of statistical surveys to meet the needs of economic and social development Recently we modified the conduct of censuses in China by introducing a new Economic Census, which merged the census of manufacturing industries, the census of service industries and the census of establishments, and included the construction sector in the new census. Two economic censuses are to be conducted in a span of 10 years. The first economic census of China, which is currently in full operation successfully despite its huge size, has mobilized over 10 million enumerators and supervisors with an estimated budget of over 3 billion RMB yuan. I had a brief meeting with Dr. Paul Cheung, Director of UNSD yesterday, where we talked about an international workshop jointly organized by UNSD and NBS on economic census in late July in Beijing. I look forward to experts invited by UNSD to share views and experiences on economic census. Sample surveys are widely used in the collection of statistics on population, households, farm production, prices, and small business. We abolished the approach of constant prices that have been in use for over 50 years by adopting the production indexes using price deflators. Over 5,000 large manufacturing enterprises and 3,000 construction companies are reporting there data through internet system, further improving the timeliness of statistics.

3) Improving statistical indicators and standards to reflect new economic and social phenomena We have set up a new labor force survey. Efforts are under way to establish methodology and standards for statistics on cultural undertakings, for comprehensive environment statistics, statistics on high and new technology industries. The establishment of national statistical system for emergency response could effectively provide information on breaking economic events or major natural disasters. New classifications are developed such as the Industrial Classification of the National Economy which is basically in harmonization with ISIC, and the Classification of Cultural and Related Activities and Nomenclature of Production, Sakes and Stock of Major Manufacturing Products.

In China, we have a statistical management system that is characterized by centralized leadership and decentralized responsibility. The National Bureau of Statistics (NBS) is responsible for organizing and coordinating official statistics nationwide. NBS has promoted the establishment of a statistical legal framework, with the Statistics Law of China as the center piece, and supplemented by statistical regulations of the State Council, of local governments and of other ministries. A network of national statistical information system is in place connecting national, provincial and municipal statistical offices. Statisticians and staff of NBS and provincial statistical bureaus are working on a paper-free environment for most of their office routine work. Large-scale statistical training programs have been implemented to improve the professional quality of statisticians.

In particular, it is worth mentioning on this occasion that international organizations such as United Nations, World Bank, IMF, OECD showed interests and provided valuable support and assistance to the reform and development of Chinese official statistics over the past decades. Governments of a number of countries made financial contributions to the development of bilateral cooperation projects in the field of statistics, a non-exhaustive list includes Canada, Italy, Germany, France, Norway, United States, Japan, Korea, etc. NBS established exchange programs with many national statistical agencies such as Australia, United Kingdom, Russia, South Africa, Egypt, Viet Nam, Thailand, just to name a few of them. All these have played an important role in promoting the integration of Chinese statistics with international standards and practices. I wish to take this opportunity to extend our heart-felt thanks and highest complements to our partners in international exchanges and cooperation.

In general, Chinese official statistics is developing in the course of reform, and is meeting the demand from the government and from the general public for statistical information. We are sure that Chinese official statistics will be able to keep pace with the world statistical development and to progress with the international community.

III. Future Development

The goal of the development of China's official statistics is to reform the management system, improve the operation mechanism and enhance the legal framework of statistics; to establish a modern official statistical system that is embodied with Chinese characteristics and integrated with general international standards and recommendations; improve the accuracy, timeliness and scientific soundness of statistical data and to enhance the authority of official statistics, in order to provide efficient and quality statistical service to the governments, the public and the international community.

To achieve the above goal, following has been identified as the priorities for the reform and development of China's official statistics in the near future:

A) Improving the government statistical system with centralized leadership and coordination and decentralized responsibility in order to build up a scientific, accountable and efficient statistical system that suits the conditions of China and is integrated with international standards and practices.

First, we will strengthen the capability of NBS to conduct direct surveys. To consolidate forces, NBS will reform the management system of the 3 survey organizations (rural, urban and enterprise surveys) directly under it, in order to make NBS more independent in conducting surveys for the collection of macroeconomic data on a timely and accurate basis, thus enhancing the capability of NBS in responding to emerging issues or breaking events. After the reform, NBS will have survey organizations in all provinces, and survey teams in all municipalities and in selected counties, with a total staff of 19,000 interviewers and supervisors. Sample surveys can be fully used with this work force to collect more statistical data.

Second, we will strengthen the management over statistical offices of local governments.

Third, NBS will provide more guidance and stronger coordination over statistical activities of line ministries.

Fourth, NBS will strengthen its guidance to, and supervision on non-governmental survey institutions.

B) Establishing a modern statistical survey system and national account system that is suitable to China's specific situation and is consistent with international statistical standards and practices, thus facilitating international comparison of statistical data

First, we will strive, as the target of the reform, to build a statistical survey system that is composed of necessary and periodic censuses and regular sample surveys, supplemented by other means such as survey of key units and scientific estimation. Existing practice of census-taking is to be improved, use of sample surveys will be expanded, comprehensive statistical reporting forms will be reduced while encouraging more use of administrative data for statistical data collection.

Second, we will consolidate statistical indicator system. Statistics developed during the planning economy will be cut off by large proportion while new statistics reflecting scientific advancement, human development, sustainable growth, etc. will be introduced. Efforts will also be made to improve statistics on resources, environment, social undertakings and services, and study will be conducted on building investment warning and monitoring indicators.

Third, we will set up unified and standardized system of statistical classification. Contents and definition of statistical indicators will be developed in consistent with international standards. General Data Dissemination System (GDDS) will be used as a framework to organize statistical surveys and disseminate statistical data in order to increase the transparency and international comparability of Chinese statistics.

Fourth, we will continue to improve the national account system. The National Economic Accounting System of China 2002 will be implemented in full scale to consolidate the current national account practices, with the aim of building a coordinated national account system that comply with the principles and requirements of the 1993 SNA.

C) Making full use of modern IT such as computer systems, network communications and data bases to transform statistical operation to achieve high efficiency in survey design, data collection, transmission, processing, management and dissemination.

First, we will expand the current statistical informatics system, and strengthen the infrastructure and the capability of data collection and data sharing.

Second, we will build up a national macroeconomic data bank covering information on economic and social development, science and technology, environment and resources. Once established, this data bank will greatly enhance our capacity in servicing macroeconomic decisions by the central government, and business or management decisions by all sectors the general public.

Third, we will strengthen the statistical infrastructure of enterprises. The current practice of reporting statistics by enterprises through internet will be expanded and electronic data recording at enterprises will be encouraged. NBS will build data collection system to ensure the uniqueness and reliability of source data from enterprises, and to reduce the workload of enterprises in reporting statistical data.

Fourth, further efforts will be made in promoting the use of new technology in statistics. NBS will promote the use of remote sensing, geographic information system (GIS) and hand-held data collection devices in its statistical operation.

D) Improving statistical legislation and supervision mechanism

First, we will further improve statistical legislation. We will make efforts to propose the revision of the current Statistics Law of China by the National People's Congress. At present, China is drafting the Census Law, and drafting of other relevant laws or regulations are under discussion. We will integrate the best international practices in statistics, such as the Principles of Official Statistics adopted by the UN Statistical Commission, into the statistical legislation in China.

Second, we will further enhance the public awareness on statistical laws and regulations by launching publicity campaign on statistics law.

Third, we will strengthen the enforcement of statistics laws. In line with relevant provisions in Statistics Law, cases of violation of statistics laws will be exposed on those who interfere or manipulate statistics for political or economic purposes.

Fourth, we will mobilize supervision of the society. Mass media will be utilized for publicity campaign and dissemination of statistics, and for public exposure of violations of statistics laws as well.

E) Building up a large contingent of statisticians with profound knowledge on statistics and with professional ethics and innovation through education and training programs

First, we will accelerate the training of statisticians with high quality.

Second, we will facilitate the development of formal statistical education system while strengthening the job-oriented training for statisticians working in government statistical agencies.

Third, we will promote research activities in statistics.

F) Building up statistical services for macroeconomic management, for the international community and for the public in general by improving the quality of services

First, a strong quality management system for national statistics will be set up to ensure the accuracy, timeliness and soundness of national statistical data.

Second, we will make efforts to enhance the capacity of statistical monitoring and analysis. Comprehensive evaluation system that meet the scientific concept of development will be explored in order to closely monitor the national economic performance, timely depict trends of economic development and identifying problems. It also helps to make policy recommendations to decision-making by governments at all levels.

Third, we will promote wider public access to statistical information. NBS will improve its website China Statistical Information Network, and build the China Statistical Library with its statistical documentation system open to the public.

Mr. Chair, ladies and gentlemen,

Official statistics in China is facing severe challenges, we have a long way ahead of us in the course of reforming and developing a efficient statistical system. While we are confident that we can work hard to improve Chinese official statistics, we need strong support and assistance from our colleagues from other countries and from international organizations. Statistics is an international language and is our common undertakings. I sincerely hope that we make joint efforts to promote the development of international statistics by developing closer exchanges and cooperation and by learning from each other. I believe that in this way official statistics could play a more important role in facilitating understanding among countries, and in describing, explaining and promoting the progress of world civilization.

Thank you.

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