China says new housing metrics behind upward revision to 2023 GDP

BEIJING (Reuters) – China stated on Friday its 2023 gross home product was revised upward due partially to adjustments in housing sector calculation strategies, which might additionally have an effect on the scale of the financial system in 2024 however have little affect on the expansion price.

On Thursday, China’s 2023 GDP was raised by 3.4 trillion yuan, or 2.7%, to 129.4 trillion yuan ($17.73 trillion), in line with the Nationwide Bureau of Statistics (NBS), which didn’t initially present an evidence for the change.

The bureau stated on Friday it had switched to utilizing rental values as a substitute of the earlier housing price calculation technique, which resulted in a rise of 1.34 trillion yuan in housing providers’ contribution to the financial system in 2023.

Previously, housing rental knowledge was incomplete as a result of China’s immature rental market, so a “housing price technique” was used to calculate housing service output, NBS stated in a press release.

Underneath the housing price technique, the whole worth of a property decreases over time as a result of depreciation, upkeep prices, property administration charges and property taxes.

“Basically, the present yr’s GDP revision impacts the next yr’s GDP measurement, however principally doesn’t have an effect on its development price,” the bureau stated.

Tertiary industries’ share of financial output rose to 56.3% in 2023 after the revision, a rise of 1.7 share factors from the preliminary knowledge, and likewise contributed to the rise within the measurement of the GDP, in line with the assertion.

Tertiary industries normally vary from retail to move, catering, lodging, finance and property.

China’s financial system has stuttered this yr as a result of a protracted property disaster, large native authorities debt and fragile shopper demand.

At an agenda-setting assembly this month, Chinese language leaders pledged to extend the finances deficit, problem extra debt and loosen financial coverage to assist financial development subsequent yr in expectation of extra commerce tensions with the U.S. when President-elect Donald Trump takes workplace in January.

The authorities have agreed to problem 3 trillion yuan of particular treasury bonds subsequent yr, which might be the best on report, in line with a Reuters report this week.

($1 = 7.2982 Chinese language yuan renminbi)