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
plus the net exports 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.
For a region,
it is called as Gross Regional Product(GRP) or regional
GDP.
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.
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 to the
owner-occupied housing and services offered by payed family employees; (c)
financial intermediate services provided by financial
institution.
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.