GDP, by definition, commonly refers to the domestic products at market prices produced by all sectors in a country during a certain period of time. In China, for national accounting and analyzing purposes, GDP (Gross Domestic Product) is calculated with three approaches: production approach, income approach and expenditure approach. They simply reflect China GDP and its composition from three different perspectives. Most GDP-related headlines in People's Republic of China (PRC) nowadays, however, are essentially based on the production approach.
China GDP (Gross Domestic Product) has jumped very rapidly since PRC started its reforms and opening up policies in 1978. Based on the complete datum from the Chinese National Bureau of Statistics (NBS), China 2012 GDP already hit RMB 51.932 trillion (absolute value calculated at current prices). Specifically, primary sector (from extraction of natural resources) continued to decline and contributed only a percentage of 10.09% in 2012 (was 10.2% in 2010). Similarly, secondary sector (by processing of primary products) also contributed a lowered percentage of 45.31% in 2012 (was 46.9% in 2010). However, tertiary sector (from services of various kinds for production and consumption) contributed an increased percentage of 44.6% in 2012 (was 43% in 2010).
The above classification of economic sectors is universal though its details may vary to some extent from country to country. Specifically, detailed classification of sectors in China are:
|Primary Sector:||Agriculture (includes farming, forestry, animal husbandry, fishery).|
|Secondary Sector:||(1) Industry: includes mining, manufacturing, production and supply of electricity, water and gas. |
|Tertiary Sector:||all other segments of the Chinese economy, such as: |
(1) Circulation: includes transportation, storage, postal, telecommunications, information transmission, computer services and Software, wholesales, retail sales, lodging and catering services.
(2) Services for production and consumption: includes banking, insurance, financial services, real estates, leasing and business services, scientific research, technical services, geological survey, water conservancy management, environmental and public facilities management, residential services.
(3) Public management: includes government agencies, political parties, social organizations, military and police service.
(4) Other services: includes education, health, social security, social welfare, culture and arts, sports, entertainment, broadcasting, movies, television etc.
Please note that, unless otherwise specified, the data mentioned refers to nominal GDP which is commonly available in China, not real GDP which some economists may also concern.
Last year, China annual Gross Domestic Product (GDP) did achieve a growth rate of +7.7% YoY. Although it was higher than our previously-estimated 2013 target (+7.6% YoY) slightly, it was still the lowest growth rate for the growing dragon in 14 years. Source: 2013 China GDP Target.
By using the same GDP growth formula as previous years, our independent global economic expert team forecasted the fair values of 2014 final goods and services shall produce (N.B: imports of goods and services are excluded) inside People's Republic of China (PRC) and then calculated the theoretical 2014 PRC GDP growth rate as +7.3% YoY.
This estimated 2014 annual Gross Domestic Product) target (GDP) matches also with our anticipated further down trend of economic growth in 2014 than that in 2013. Major assumptions for this 2014 growth rate are:
(1) Developed countries such as USA, Canada, U.K., Germany, Italy and France in Europe will continue to gain a little economic recovery in 2014.
(2) We anticipate that 2014 PRC economy will continue to slowdown a little bit. Even greater level of economic slowdown will occur in other emerging countries such as BRICS (they are namely Brazil, Russia, India, and South Africa). We also anticipate that other Asian Pacific economies (South Korea, Indonesia, Singapore etc except Japan) will achieve a relatively stronger economic growth in 2014.
(3) PRC central government and Chinese State Council announced formally in March already to maintain its official 2014 GDP annual growth rate target at approximately +7.5% YoY.
These are major reasons behind our estimation of 2014 GDP economic growth rate target. Our 2014 GDP annual growth rate target is calculated with the production approach formula, which is commonly used in China, although in the future we may extend our coverage to the income approach or the expenditure approach formula which can reflect domestic GDP economic growth rate and its composition from different aspects.
Please note that the +7.3% shall just be our very initial release of 2014 annual PRC GDP (Gross Domestic Product) forecast value. We reserve our rights to downgrade/upgrade our own 2014 economic growth forecast once the related PRC domestic or worldwide economic environment may suddenly change.
More PRC Economic Target(s): Table and Full Summary for our own
PRC Economic Targets