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Booming China defends its numbers

Countering charges that it exaggerates economic data, China on Wednesday defended the credibility of its statistics and accused its critics of arriving at misguided conclusions.

China's National Statistics Bureau, which has the tough task of gathering data in the world's most populous country, said the nation's economy grew a stunning 7.6 per cent in the first quarter and the data could be believed.

"I have read most of the articles that criticise the accuracy of China's data and I found that most have problems with logic or the way they argue their case," statistics bureau Vice Director Qiu Xiaohua told a news conference.

"During 20 years of reform, China's statistics system has been greatly reformed," he said.

The comments were aimed at critics like international business publications and some analysts, at home and abroad, who have questioned the accuracy of China's data in recent months.

Under-reported data?

Many argue China has consistently inflated politically sensitive growth data to enhance its international image and garner local support for the propaganda churning Communist Party.

Others say the patchy improvements in data collection methods after two decades of explosive economic reforms have meant China's growth may even have been under-reported.

One example of faulty data that is often cited is the discrepancy between China's rapidly growing economy of recent years and lagging energy consumption.

But historical data from the United States, South Korea, Japan and Germany showed a similar phenomenon, Qiu said.

In a research note, Morgan Stanley economist Andy Xie said recent claims that China widely exaggerated its economic growth figures had erroneously centered on the energy argument and that China's growth in the past two decades had been underestimated.

"The claim on the bad statistical data was based on equally inaccurate energy consumption data," Xie said.

China's export data could be verified by import data in other countries and there was no incentive for misreporting deposit data as that comes under central bank control, he said.

"Not only has China's growth in the two decades is not exaggerated, it has been underestimated," he said.

Statistical crimes

Qiu said China was cracking down on statistical crime.

The Statistical Bureau said earlier this year investigations had revealed more than 60,000 violations of the statistics law in 2001, of which 19,000 cases had been dealt with.

Qiu said that statement led critics to conclude the violations were related to exaggerated figures. But he said some cases were actually about "under-reporting" data or failing to file reports in a timely manner, if at all, he said.

"It is not all for faking the data," he said.

Still, Qiu admitted Chinese data had shortcomings.

"The data provided to the public is not complete and is not always given in a timely way."

That echoed comments made by Premier Zhu Rongji, who said last week China had wrung much excess "water" out of its statistical reporting over the past 50 years, but not all of it.

Joining world data group

Qiu said that China, a freshman in the World Trade Organisation, will join the General Data Dissemination System, as recommended by the International Monetary Fund in future.

"We think in the future, the public can get the data in a convenient, timely and easy way," he said.

As a final word to critics, Qiu advised people to pay close attention to savings deposit figures for Chinese residents, which had grown from 20.6 billion yuan ($2.49 billion) in 1978 -- when economic reforms were launched following decades of hardship -- to 7.8 trillion yuan today.

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