Explanatory
Notes on Main Statistical Indicators
Gross
Domestic Product (GDP) refers
to the final products at market prices produced by all resident units in a
country (or a region) during a certain period of time. Gross domestic product
is expressed in three different perspectives, namely value, income, and
products respectively. GDP in its value perspective refers to the total value
of all goods and services produced by all resident units during a certain
period of time, minus the total value of input of goods and services of the
nature of non-fixed assets; in other words, it is the sum of the value-added of
all resident units. GDP from the perspective of income includes the primary
income created by all resident units and distributed to resident and
non-resident units. GDP from the perspective of products refers to the value of
all goods and services for final demand by all resident units minus the imports
of goods and services during a given period of time. In the practice of
national accounting, gross domestic product is calculated from three
approaches, namely production approach, income approach and expenditure
approach, which reflect gross domestic product and its composition from
different angles.
Gross National
Income (GNI) also known as Gross National Product, refers to the final
result of the primary distribution of the income created by all the resident
units of a country (or a region) during a certain period of time. The
value-added created by the resident units of a country engaged in production
activities is distributed, during the primary distribution, mainly to the
resident units of that country, while part of it is distributed to the
non-resident units in the form of production tax and import duties (minus
subsidies to production and import), compensation of employees and property
income. In the meantime, a part of the value-added created abroad is
distributed to the resident units of the country in the form of production tax
and import duties (minus subsidies to production and import), compensation of employees
and property income. The concept of Gross National Income is thus developed,
which equals to Gross Domestic Product plus the net factor income from abroad.
Unlike GDP which is a concept of production, GNP is a concept of income.
Three Strata of Industry Classification of economic activities into three strata of industry
is a common practice in the world, although the grouping varies to some extent from
country to country. In
Primary industry
refers to agriculture, forestry, animal husbandry and fishery and services in
support of these industries.
Secondary industry
refers to mining and quarrying, manufacturing, production and supply of
electricity, water and gas, and construction.
Tertiary industry
refers to all other economic activities not included in the primary or
secondary industries.
Compensation of Employees refers to the total payment of various forms to employees for
the productive activities they are engaged in. It includes wages, bonuses and
allowances, which the employees earn in cash or in kind. It also includes the
free medical services provided to the employees and the medicine expenses,
transport subsidies and social insurance, and housing fund paid by the
employers. As regards the individual economy, since compensation of employees
is not easily distinguishable from the operating surplus, both parts are
treated as compensation of employees.
Net Taxes on Production refers to taxes on production less subsidies on production.
The taxes on production refers to the various taxes, extra charges and fees
levied on the production units on their production, sale and business
activities as well as on the use of some factors of production, such as fixed
assets, land and labour in the
production activities they are engaged in. In contrast to taxes on production,
subsidies on production refer to the unilateral government transfer to the
production units and are therefore regarded as negative taxes on production.
They include subsidies on the loss due to implementation of government
policies, price subsidies, etc.
Depreciation of
Fixed Assets refers to the depreciation of fixed assets in a given
period, drawn in accordance with the stipulated depreciation rate for the
purpose of compensating the wear-and-tear loss of the fixed assets or the
depreciation of fixed assets imputed in accordance with the stipulated unified
depreciation rate in the national economic accounting system. It reflects the
value of transfer of the fixed assets in the production of the current
period. The depreciation of fixed
assets in various enterprises and institutions managed as enterprises refers to
the depreciation expenses actually drawn. In government agencies and
institutions not managed as enterprises which do not draw the depreciation
expenses, as well as for the houses of residents, the depreciation of fixed
assets is the imputed depreciation, which is calculated in accordance with the
stipulated unified depreciation rate. In principle, the depreciation of fixed
assets should be calculated on the basis of the re-purchased value of the fixed
assets. However, currently the conditions in
Operating Surplus refers to
the balance of the value added created by the resident units after deducting
the labourers remuneration, net taxes on production and the depreciation of
fixed assets. It is equivalent to the business profit of the enterprises plus
subsidies to production, but the wages and welfare expenses paid from the
profits should be deducted.
GDP by Expenditure Approach refers to the method of measuring the final results of
production activities of a country (region) during a given period from the
perspective of final uses. It includes final consumption expenditure, gross
capital formation and net export of goods and services. The formula for
computation is.:
GDP by expenditure approach = final
consumption expenditure + gross capital formation + net export of goods and
services
Final Consumption Expenditure refers to the total expenditure
of resident units for purchases of goods and services from both the domestic
economic territory and abroad to meet the needs of material, cultural and
spiritual life. It does not include the expenditure of non-resident units on
consumption in the economic territory of the country. The final consumption
expenditure is broken down into household consumption expenditure and
government consumption expenditure.
Household
Consumption Expenditure refers to the total expenditure
of resident households on the final consumption of goods and services. In
addition to the consumption of goods and services bought by the households
directly with money, the household consumption expenditure also includes
expenditure on goods and services obtained by the households in other ways,
i.e. the so-called imputed consumption expenditure, which includes the
following: (a) the goods and services provided to households by employers in
the form of payment in kind and transfer in kind; (b) goods and services
produced and consumed by the households themselves, in which the services refer
only to the owner-occupied housing; (c) financial intermediate services
provided by financial institutions; (d) insurance services provided by
insurance companies.
Government
Consumption Expenditure refers to the consumption expenditure
spent for the provision of public
services provided by the government to the whole country and the net
expenditure on the goods and services provided by the government to households
free of charge or at reduced prices. The former equals to the output value of
the government services minus the value of operating income obtained by the
government departments. The latter equals to the market value of the goods and
services provided by the government free of charge or at reduced prices to the
households minus the value received by the government from the households.
Gross Capital Formation refers to the fixed assets acquired less disposals and the
net value of inventory, thus including gross fixed capital formation and changes
in inventories.
Gross Fixed Capital Formation refers
to the value of acquisitions less those disposals of fixed assets during a
given period. Fixed assets are the assets produced through production
activities with unit value above a specified amount and which could be used for
over one year. Natural assets are not included.Gross
fixed capital formation can be categorized into total tangible fixed capital
formation and total intangible fixed capital formation. Total tangible fixed
capital formation includes the value of the construction projects and
installation projects completed and the equipment, apparatus and instruments
purchased (less those disposed) as well as the value of land improved, the
value of draught animals, breeding stock and animals for milk, for wool and for
recreational purposes and the newly increased forest with economic value. Total
intangible fixed capital formation includes the prospecting of minerals and the
acquisition of computer software minus the disposal of them.
Changes in Inventories refers
to the market value of the change in the physical volume of inventory of
resident units during a given period, i.e. the difference between the values at
the beginning and at the end of the period minus the gains due to the change in
prices. The changes in inventories can have a positive or a negative value. A
positive value indicates an increase in inventory while a negative value
indicates a decrease in inventory. The inventory includes raw materials, fuels
and reserve materials purchased by the production units as well as the
inventory of finished products, semi-finished products and work-in-progress.
Net Export of Goods
and Services refers to the exports of goods and services subtracting the
imports of goods and services.
Exports include the value of various goods and services sold or
gratuitously transferred by resident units to non-resident units. Imports
include the value of various goods and services purchased or gratuitously
acquired resident units from non-resident units. Because the provision of
services and the use of them happen simultaneously, the acquisition of services
by resident units from abroad is usually treated as import while the
acquisition of services by non-resident units in this country is usually
treated as export. The exports and imports of goods are calculated at FOB.
Direct Input Coefficient refers to the volume of products and services of industry i, which is consumed directly by industry j
in the course of its production or business, recorded as aij
(i,j=1,2, … ,n). The table of direct
input coefficients, or the direct input coefficients matrix, usually denoted as
A, is a table that presents direct input coefficients of all industries.
Total Input Coefficient refers to the volume of products and services of industry i which is consumed directly and indirectly by
industry j in producing each unit of final use. The table of total input
coefficients, or total input coefficients matrix, usually denoted as B, is a
table that presents total input coefficients of all industries.
Institutional Units refer to economic entities that are in a position to own
assets and incur liabilities; to engage independently in economic activities;
and to conduct transactions with other entities.
Institutional Sectors refer to groups of institutional units that are homogenous
in nature and have been grouped together. The following 4 institutional sectors
are identified in the flow of funds accounts: non-financial corporations,
financial institutions, general government and households. Also
treated as an institutional sector is the rest of the world, which is composed
of non-resident units that have economic relations with resident units.
Non-Financial
Corporations and the Sector of Non-Financial Corporations Non-financial corporations refer to resident corporations
that are engaged in the production of goods and the provision of non financial
services in the market, mainly covering corporate enterprises of various types
engaged in the above-mentioned activities. All non-financial corporations make
up the sector of non-financial corporations.
Financial
Institutions and the Sector of Financial Institutions Financial institutions refer to resident institutions that are
engaged in the financial intermediary services or auxiliary financial
activities that are closely related with financial intermediary services,
mainly covering the Central Bank, commercial banks, policy banks, non-banking
credit institutions and insurance companies. All financial institutions
together make up the sector of financial institutions.
General Government
and the Sector of General Governments General government refer to legal entities and their auxiliary
units within the
Households and the Sector
of Households Households refer to resident individuals or groups of resident
individuals who share common living facilities, pool together entire or part of
their income and properties for their common disposal, and share their housing,
food and other consumer goods and services. All households together make up the
sector of households.
Non-resident Units
and the Rest of the World Non-resident units refer to units that are of a
non-resident nature. All non-resident units that have transactions with resident
units together make up the rest of the world.
Total Income from
Primary Distribution Primary distribution refers to the distribution of net
results from production activities among the owners of factors of production
and the governments.The net results from production
activities is the value-added. Factors of production include labour force, land
and capital. Owners of labour force gain remuneration by providing labour.
Owners of land receive rents from leasing of land. Owners of capitals get income
of various forms depending on the type of capital: owners of loan capital
receive income from interests. Share holders receive dividends or
non-distributed profits. Government either obtains production tax or pays
subsidies in participating directly or indirectly in the production processes.
Results of primary distribution generate the total income from primary
distribution of each sector, and the sum of the total income of primary
distribution of all sectors make up the Gross National Income, or the Gross
National Product.
Current Transfers Transfer refers to the transaction in the form of provision of
goods, services or assets by an institutional unit to another institutional
unit without receiving any goods, services or assets in return from the recipient.
Current transfers refer to all kinds of transfers other than capital transfers.
They include income tax, payment to social securities, social allowances and
other current transfers.
Total Disposable Income Total income from primary distribution is re-distributed
through current transfer, resulting in the total disposable income of various
institutional sectors. The sum of total disposable income of all institutional
sectors makes up the total national disposable income.
Total Savings refer to total disposable income
subtracting final consumption. Total savings of all sectors make up the total
national savings.
Capital Transfer refers to the free payment from one sector to another sector
of non-financial investment capital, and is a transaction that seeks no return
from the recipient. Capital transfer differs from current transfer in 2
aspects: 1) The purpose of the capital transfer is
investment rather than consumption. 2) Capital transfer features the transfer
of the ownership of assets other than inventory and cash, and capital transfer
in its monetary form involves the disposal of assets other than inventory.
Capital transfer includes investment subsidies and other capital transfers.
Net Financial Investment reflects the surplus or shortage of capitals of institutional
sectors or of the economy in general. It refers to total savings plus the
income from capital transfer minus payment for capital transfer and the
non-financial investment from the point of view of physical transaction. In
terms of monetary transaction, it is the difference between the increase in financial assets minus the increase of the
financial liabilities.
Currency refers to currency that is in circulation in the market, including local and
foreign currencies.
Deposits refer to credit transactions by which financial institutions accept deposits
from clients who could withdraw their deposit at any time or by an agreed time
frame. They include demand deposit, time deposit, savings deposit, fiscal
deposit, foreign exchange deposit and other deposits.
Loans
refer to credit transactions by which financial institutions lend their
capital to clients at certain level of interest rates, which the latter will
repay by an agreed time frame. They include short-term loan, medium- and
long-term loan, fiscal loan, foreign exchange loan and other loans.
Securities (excluding shares) refer
to written certificates representing creditors’ rights as purchased by bond
holders or as acquired by selling products, which can be transacted at the
financial markets. They include government bonds, financial bonds, corporation
bonds, commercial drafts, preferential stocks that provide fixed income without
the right to share the residual value of corporations, and so on.
Shares and Other Holding
Rights refer to the rights of stockholders and direct investors on the net assets of
corporations they have invested in. Shares refer to negotiable securities on
creditor’s rights, issued by share companies certifying the investment by
stockholders and their rights and duties in accordance with the amount of
stocks that they hold. Other holding rights refer to the direct investment by
institutional units in other units with currency capital or with assets, in
forms other than shares and negotiable securities on creditor’s rights,
including such tangible assets such as land, buildings, machines and equipment,
inventory, resources, etc., and such intangible assets as trade marks, patents,
monopolies, rights on land use, licenses, commercial reputation, etc..
Documents of proof of holding rights usually include certificates on creditor’s
right, certificates on investment or on participation, etc.
Insurance Reserve Funds consists of net equity of households in life insurance
reserves and in pension funds reserves, prepayments of insurance premiums, and
reserves for outstanding claims.
Settlement Fund refers to fund in float of financial institutions for
settlement.
Inter- financial
Institutions Accounts refer to flow of capital between financial institutions,
consisting of nostro & vostro
accounts, inter-bank lending.
Required and
Excessive Reserves refer to financial institutions’ deposits with the People’s
Bank of China.
Central Bank Lending refer to lending to financial institutions by the People’s
Bank of China
Current Account includes goods, services, income and current transfers.
Import and Export of
Goods refer to imported or exported goods through Chinese
customs. Both import and export of goods are valued at free on board (f.o.b.)
prices. Free on board prices can be regarded as the purchaser’s prices paid by
importers when claiming goods at the border of the exporters. When the importer
claim the imported goods, the goods have been loaded in importer’s carriers or
other carriers, and the exporter has paid export duty or received export
redeem.
Import and Export of
Services refer to services provided between resident and
non-resident units, including services on transportation, tourism,
communications, construction, insurance, finance, computer and information,
consultancy, advertising and publicity, as well as film, audio and video
services, royalty for patents, trademarks and other special rights, other
commercial services, and government services.
Income refers income from provision of factors of production between resident and
non-resident units, including compensation of labour and earnings from
investment. Earnings from investment include earnings from and expenses on
direct investment, security investment and other investment, as well as
reinvestment of earnings from direct investment.
Capital Account includes
capital transfers such as immigration transfer, reduction or exemption of
debts, etc.
Financial Account includes direct investment, security investment and other
investments.
Direct Investment refers to investment by foreign investors or investors from
Security Investment refers to the issue of stocks and securities by
Other Investment refers to all external transactions on financial assets and
liabilities other than direct investment and security investment, including
trade credits, loans, currency, deposits and other assets, provided by foreign
countries to
Reserve
Assets, Net Increase refers to the difference between the end of the reference
year and the end of the previous year, in gold reserve, foreign exchange
reserve, special drawing rights in the International Monetary Fund, and the use
of the Fund’s credits. An increase in reserve assets is expressed in a negative
figure and a decrease in the reserve assets is expressed in a positive figure.