ACCOMPLISHMENT OF THE INTERNATIONAL COMPARISON PROGRAM 2017
National Statistical Society of China
May 19, 2020
The International Comparison Program (ICP) 2017 started its preparations since the year of 2016, and accomplished with the final results released by the World Bank on May 19, 2020. In the past four years, the National Statistical Society of China has implemented all the activities of ICP 2017, covering data collection, validation, assessment and reporting processes, in accordance with the common arrangements of the World Bank and the ICP Survey.
1. National Statistical Society of China was responsible for organizing and implementing ICP 2017 in China.
A total of 176 economies participated in ICP 2017 led by the World Bank. In China, ICP is an exploratory international statistical cooperation program, organized and implemented by the National Statistical Society of China. During ICP 2017, about 40,000 outlets were selected in 31 provinces (autonomous regions, municipalities) of China. Price data of more than 1000 items were collected from Household Consumption Price Survey, Machinery and Equipment Price Survey, Construction Price Survey, Housing Rental Survey, and Government Compensation Survey. Based on data quality assessment framework of ICP, intra-economies data validation, and inter-economies data validation of the Asia and Pacific region were employed to ensure the prices and structure data collected could reflect China’s price reality.
2. The main results from ICP 2017 showed that the PPP- based global economic volume was conspicuously higher than that of exchange rate-based.
1) The global results
a. Based on PPP method, the global GDP volume of the world’s 176 ICP-participating economies reached US$119.5 trillion in 2017, 50.0 percent higher than the total GDP volume US$ 79.7 trillion based on exchange rate method. For 161 economies, their PPP based GDP are larger than exchange rate-based GDP, accounting for 91.5 percent of all the participation economies. In comparison with the exchange rate-based GDP ranks, PPP-based GDP ranks for developing economies moved upward faster. For example, India’s GDP rose from the 7th place using exchange rate method to the 3rd place by PPP method, Indonesia from the 16th up to the 10th place, Turkey from the 17th to the 13th, and Egypt from 45th to 19th.
b. The top 10 countries with PPP-based GDP in 2017 were China, U.S.A, India, Japan, Germany, Russia, U.K., Brazil, France and Indonesia. The total volume of GDP of all these countries accounted for around 60.7 percent of the world total.
c. The top 10 economies with PPP-based GDP per capita in 2017 were Luxembourg, Qatar, Singapore, Ireland, Bermuda, Cayman Islands, Switzerland, the United Arab Emirates, Norway and Brunei Darussalam, with an entry threshold of US$ 60,282 per capita.
2) The results of China
a. China’s PPP in 2017 was 1 US dollar equaling to RMB 4.184.
b. China’s PPP-based GDP in 2017 was US$ 19.6 trillion, US$ 7.5 trillion higher than the exchange rate-based GDP of the same year, 0.5 percent slightly higher than that of the U.S.A, accounting for 16.4 percent of the total volume US$ 119.5 trillion of 176 economies together.
c. China’s PPP-based GDP per capita in 2017 was US$ 14,150, US$ 5391 more than that of exchange rate-based in the same year, ranking 90th in the world (China’s exchange rate-based GDP per capita ranked 79th in the world in the same year), which was equivalent to 85.3 percent of the world average and 23.6 percent of the U.S.A.
d. A comparison of 22 economies in the Asia-Pacific region showed that in 2017, taking Hong Kong Special Administrative Region of China as a base economy and the Hong Kong dollar as a numeraire currency, Chinese PPP is 1 Hong Kong Dollar equivalent to 0.70 RMB, approximately 80.3 percent of the exchange rate 0.87 (RMB/HK$)in that year. In 2017, China’s GDP in PPP was HK$ 117.9 trillion, accounting for 50.8 percent of the total GDP in the Asia-Pacific region, and PPP-based GDP per capita was HK$ 85,061, ranking number 8 in the Asia-Pacific Region.
3. The results based on PPP do not represent the official statistics and China remains the largest developing country.
1) The ICP 2017 results do not represent the official statistics. In its Purchasing Power Parities and the Size of World Economies – Results from the 2017 International Comparison Program, it is noted that the results for all economies are produced by regional implementing agencies and the ICP Global Office of the World Bank, are not produced by participating economies as part of the economies’ official statistics. It is stresses that there are certain limitations existing in ICP, and its results need to be cautiously used. For example, neither can PPP be used as a basis for judging a country’s exchange rate, nor can the PPP results be used directly in evaluating the poverty alleviation performance by the international poverty line.
2) China is the largest developing country in the world. China’s PPP-based GDP per capita in 2017 was only 85.3 percent of the world average, ranking 90th in the world, 11 places downward from the ranking list of exchange rate- based GDP per capita. Obviously there is a large gap comparing with the developed countries. All in all, still China is the largest developing country in the world.