International Cooperation in National Accounts Xu Xianchun Director-General Department of National Accounts National Bureau of Statistics May 10-12, 2004 Contents ： Part I ： Overview on international cooperation in recent 10 years
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Department of National Accounts
National Bureau of Statistics
May 10-12, 2004
Part I：Overview on international cooperation in recent 10 years
Part II：Main problems existing in Chinese national accounts
Part III：Outlook for further international cooperation
（1）Cooperation with IMF
Based on preliminary statistics, 21 person-times (15 persons) from DNA (Dept. of National Accounts) have been involved in the training programs provided by IMF. The topics cover national accounts, financial programming, monetary statistics etc. Of which, 2 persons finished their one-year study in the GRIPS, Japan and obtained their MPP degree under the sponsorship of IMF. Nine persons attended training courses on national accounts held by IMF in US, Singapore and Austria respectively. Nine persons attended the Financial Programming and Policy Courses co-sponsored by the People’s Bank of China and IMF. One person attended the Monetary and Financial Statistics Courses co-sponsored by the People’s Bank of China and IMF.
Cooperation with OECD focuses in two aspects:
A. Mathodological research on problematic key issues on national accounts
B. Research on cyclical indicators
The cooperation in the field of mathodological research on problematic key issues on national accounts is conducted in the form of NBS-OECD workshops held alternatively in Chinese inland cities and in Paris. So far, seven workshops have been held since 1996. Of which, the first（Sept.1996）, the third (Oct.1998), the fifth (Sept.2001), and the seventh (Nov.2003) were held in Beijing, Chengdu and Dalian respectively; the second (Aug.1997), the fourth (Oct.2000), and the sixth (May 2002) were held in Paris. Currently, the preparation for the eighth workshop (Dec.2004) which is going to be held in Paris is in progress.
The topics of the workshops cover almost all important issues in national accounts in terms of the complexity or the weak accounting performance, comprising the compilation methods of the annual accounts, housing service statistics, real estate accounting, other services measurement, constant price measures, capital stock estimation, assessment of the quality of GDP, seasonal adjustment in quarterly accounts, benchmarking quarterly accounts to annual accounts, NOE accounting methods etc. Under the sponsorship of OECD, the papers presented are compiled and published by NBS after each workshop in the title of Research of Methodological Issues on National Accounts. So far, the series has been numbered 7.
Cyclical indicator research started in 1998, where the construction of national cyclical indicators is the emphasis for the cooperation of the first phase, and the construction of regional cyclical indicators for the second. Under the technical assistance of OECD expertise, a Chinese-English bilingual book, Business Cycle and Cyclical Indicators in China, was co-published by NBS and OECD in March, 2001. The second phase of cooperation is a further step of the first one, where the possibility of the construction of regional composite leading indicators is explored. The outcome is another Chinese-English bilingual book named Regional Composite Leading Indicators for Shanghai, China was co-printed in Apr. 2002. At present, OECD’s regional cooperation with China in this field has been extended to Shaan Xi Province to help choosing a set of scientific leading indicators.
ADB provides technical assistance to NBS to improve its measurement of service industries, very relevant for a better national accounts, in China. This project was initiated in 2003, which plans to spend three years to help China to achieve a scientific and systematic accounting framework in services accounting based on a fully understanding of current Chinese service statistics practice and on the experiences obtained from the trial estimates for some regional pilot surveys.
The cooperation between NBS and Statistics Canada are conducted in three fields that are renting measurement for household dwellings, stock value of fixed capital, and quarterly accounts.
（a) measurement for household dwellings
Drawing experience on the estimation method of Canada on household dwellings and combining the specific situation of China, NBS chose cost method to estimate the rents of household dwellings for a period 1990-2000, which includes the total expenditure during the services comprising the cost of repair and maintenance of dwellings (materials and wages), the administration fees of dwellings charged by housing administration agencies, the imputed depreciation of household dwellings. Based on a great amount of information collected in the process of this project, the share of rents in GDP has increased by 4.5-7.2% via the new method from 1.1-2.2% via the old method. The average increase over the considered period is about 3 percent. The level of rents is increased considerably as well, take 2000 for instance, the rents rises from 194. 46 billion Yuan to 444. 74 billion Yuan. This project was awarded the second-class prize of 2nd NBS Research Outcomes in Feb., 2004.
(b) Measurement of the stock value of fixed capital
Under the technical assistance of Statistics Canada, the capital stock measurement project, DNA uses both perpetual inventory method (PIM) and geometric depreciation function method to calculate and re-adjust the net current price value of the stocks of the state-owned fixed capital of China (urban and rural dwellings,machinery and equipments, infrastructure construction, non-dwelling buildings, and livestocks), and the corresponding consumptions of the fixed assets (depreciation). This project was awarded the first-class prize of 2nd NBS Research Outcomes in Feb., 2004.
(c) Quarterly Accounts
Two training courses were given alternatively in Beijing and Ottawa, where the participants are from NBS, some regional statistical bureau and some related ministries. The training courses are delivered by experts in the form of presentation and instructor-led lab concerning benchmarking quarterly data and seasonal adjustment, using software developed by Canada. In January 2004, DNA benchmarked the quarterly data over 1992-2001 to annual estimates for the first time based on the project method, and formally published the results.
（1）Problems of service-industry measurement
（2）Problems of quarterly accounts
（3）Problems of constant-price estimation
（4）Problems of classification
（5）The inconsistency between national accounts and specific statistics in NBS
（6）The gap between national data and regional data
（7）Problems of environmental accounting
（8）The issue of Non-Observed Economy
DNA expects further technical assistance from the international organizations or related experienced countries in the follow aspects:
(1) Improving service-industry measurement of China
Desirable technical assistance from international organizations or experienced countries are the techniques on design and implementation of regular sample surveys and data processing for service-industries. In addition, DNA also needs recommendations on how to make best use of the existing departmental records and administration data.
(5) Improving environmental accounting in China
Due to the increasing importance and the complexity of environmental accounting, the existing outcomes of research and the experiences of practice should be absorbed before the compilation of the environmental accounts of China can be started. Therefore, DNA expects continuous support from international organizations and related experienced countries in this field.
(6) Establishing framework of NOE accounting in China
In theory, NOE (Non-Observed Economy) is necessary to be included in GDP accounting to ensure a comprehensive, exhaustive, high quality GDP, and to make GDP comparable internationally. Therefore, DNA welcomes technical assistance on establishing Chinese NOE accounting framework in adapting the circumstances that the share of NOE in Chinese GDP has been increasing over time.