China GDP: how it has changed since 1980
by “The Guardian” DATA BLOG
China, the second-biggest economy in the world, has announced a cut to it’s growth rate for 2012. See how China’s GDP has changed since 1980
The premier of the Republic of China, Wen Jiabao announced the cut during the deliverance of the annual work report at the opening of the National People’s Congress. Tania Branigan writes:
The target of 7.5% for 2012 reflects expectations that reduced exports due to the European crisis and a fragile US recovery could dampen growth in the world’s second-largest economy. But by abandoning the longstanding 8% goal the government is also signalling its desire to reshape development.
“In setting a slightly lower GDP growth rate, we hope … to guide people in all sectors to focus their work on accelerating the transformation of the pattern of economic development and making economic development more sustainable and efficient,” Wen said.
So how does China’s economy look? We’ve pulled together some key indicators from the World Bank and the International Monetary Fund (IMF) to examine how the country is getting on. We have also used data from the Congressional Research Service and the CIA World Factbook
Before the Chinese government introduced several economic growth reforms in 1979, the average annual real GDP growth rate in China was estimated at 5.3% (from 1960-1978) according to the Congressional Research Service. In 2010 the annual growth rate stood at 10.4%. As the chart above shows there have been some steep inclines and drops in China’s GDP growth rate with the effect of the global recession showing in 2008 when the annual rate dropped to 9.6% compared to 14.2% during the previous year.
Gross Domestic Product (GDP)
China’s GDP is controversial, not least because it’s measured differently to other some countries. A Wikileaks US Embassy cable revealed that Liaoning Party Secretary Li Keqiang had called the GDP measure “man made”, adding further to the belief by some that it is inaccurate and unreliable.
The problem lies with the official exchange rate – it’s established by government regulation and not determined by market forces – so therefore it’s seen as not being a reliable measure of China’s output in relation to other countries worldwide. As author of Understanding China’s Economic Indicators, Tom Orlik wrote in The Wall Street Journal: “China’s GDP data is haunted by controversy, with widespread doubts about its accuracy.”
According to the CIA World Factbook comparisons of output across countries is best judged, in the case of China, by looking at GDP at purchasing power parity – which takes into account the amount of money needed to buy the same goods and services in two different countries and then calculates an implied foreign exchange rate. The IMF estimated China’s GDP at purchasing power parity at $11.3tn for 2011.
The great interactive by The Economist above shows how the GDP of China and the US compare and allows you to put in your own estimations about real GDP growth, inflation rates and the yuan’s exchange rate against the dollar.
The table below shows some key economic indicators for 1980, 1990, 2000, 2011 and 2016. There is also annual data going back to 1960 in the spreadsheet which details other important economic factors such as unemployment, govermental expenditure and imports and exports. What can you do with the data?