The World Bank welcomes the release of new National Accounts data for China, according to a news release of the World Bank Tuesday.

The new data, released Tuesday, show a GDP estimated for 2004 some 16.8 percent higher than was previously recorded, the World Bank said in the news release. The new figures show that China's economy is the world's seventh largest.

"These new GDP data are a major improvement over the previous ones," said Bert Hofman, Chief of the Economics Unit of the World Bank Office in Beijing, "and they are the result of the hard work of NBS (National Bureau of Statistics) staff and all people involved in this year's National Economic Census."

Hofman said the data will give better information on the current situation in the economy as well as on structural issues such as sectoral shares in the economy.

"The new data are very timely," Hofman said, "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 noted that some of the ratios that have drawn policymakers' attention, such as Investment to GDP, Services to GDP and Energy Intensity, are likely to change in light of the new GDP numbers.

The World Bank notes that it is not uncommon that countries with rapid growth regularly see major revisions in their GDP.

Misha V. Belkindas, Manager of the World Bank's Development Data Group in Washington D.C. notes that the reason for revisions are that many new enterprises are established in dynamic economies,which are only imperfectly captured by the statistical system. Moreover, surveys to determine GDP tend to under-represent rapidly growing enterprises, said Belkindas.

"The important thing is that we now have better data to work with," Hofman said, "and we are looking forward to a technical briefing by NBS to understand the detail of the revisions."

With the increase in measured GDP, China passes Italy to become the 6th largest economy in the world. China was previously considered the world's seventh largest economy.

Source: Xinhua