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China 2004 GDP revision provides improved insight into economy- World Bank


BEIJING (AFX) - The World Bank has welcomed China's revision of its 2004 gross domestic product figures, saying the new data will provide better insight into China's economy.

In a statement the bank said the revised figures released today by the National Bureau of Statistics will give better information on the state of the Chinese economy as well as structural issues such as sector contributions to the economy.

'The new GDP data are a major improvement' over the previous indicators, according to Bert Hofman, chief of the economics unit of the World Bank office in Beijing.

Earlier today the NBS upgraded its 2004 GDP estimate by 16.8 pct after preliminary input from the 2004 economic census.

The NBS said that 2.3 trln yuan had been added to the 2004 GDP figures, bringing the total to 15.99 trln yuan.

The service sector accounted for 2.1 trln yuan of that additional figure, or 93 pct of the revised figure, the NBS said.

The bureau also said that the service sector's contribution to GDP was revised upwards to 40.7 pct from 31.9 pct.

Hofman called the new data 'very timely as many policy issues that the government wants to tackle in the forthcoming 11th Five Year Plan need reliable data for those issues to be assessed correctly,' Hofman said.

Hofman noted that some of the ratios that have drawn policymakers' attention, such as the investment to GDP, services to GDP and energy intensity, are likely to change in light of the new GDP numbers.

At a news conference following the issue of the statement, NBS director Li Deshui said that the revised figures will have no impact on China's macro-economic policy or the reform of its exchange rate regime.

The bank added in the statement that the magnitude of China's revision was by no means an exception, and that revisions tend to be larger for countries that grow faster.

'The important thing is that we now have better data to work with,' Hofman said.

'We are looking forward to a technical briefing by the NBS to understand the detail of the revisions,' he added.

With the revised GDP figures, China has passed Italy to become the sixth largest economy in the world, up from seventh place, the World Bank said.