China’s economy is $308.8 billion larger than previously reported, according to findings released Thursday from the country’s National Bureau of Statistics (NBS). The 3.4 percent upward revision of China’s gross domestic product in 2013 is almost equivalent to Malaysia’s economic output.
The revision means China’s debt-to-GDP ratio is smaller than previously thought, which gives the government a little more room to find ways to check the country’s cooling economy, which is expected to be the slowest since 1990. But even with the revision, the country’s debt is well more than twice its GDP.
“Chinese economic growth will continue on its downward trend in 2015, whatever the revisions,” Pauline Loong, managing director at Asia-analytica Research Pte in Hong Kong, told Bloomberg News. The country’s economic census is conducted every five years, gathering data on manufacturing and services activity from the country’s 22 provinces. The 2004 census revised the country’s GDP by almost 17 percent. In 2009, the census revised the country’s economy upward by 4.4 percent.
Friday’s revision came because of an improved measure of the country’s rapidly expanding services sector, NBS said.
Economists polled by Bloomberg expected between a 1 percent and 3 percent upward revision, but some had expected revisions by as much as 10 percent if China altered the way it measures its economic output. China could implement another upgrade when it releases full-year 2014 GDP figures early next month.
Last year the U.S. began counting R&D and other activity as part of its GDP accounting method, and applied that change retroactively back to 1929. Now, for example, spending money to create intellectual property (Hollywood filmmaking or pharmaceutical research, for example) is considered economic output.
This shift in methodology has its skeptics that believe it makes it easier for lawmakers to point to rosier economic data that don’t accurately represent the health of the economy.