(Economic Observation) The World Bank claims that China's GDP exceeded US in 2017, but is China already a developed country?

  China News Agency, Beijing, May 23 (Reporter Pang Wuji) According to a report recently released by the World Bank, China's gross domestic product (GDP) exceeded the United States in 2017 and has become the world's largest economic power. But is China already a developed country? What is the actual situation?

  A few days ago, the World Bank released the report "Purchasing Power Parity and World Economic Scale-Results of the 2017 Round International Comparison Project (ICP)" on its official website. The report shows that China ’s 2017 GDP calculated based on purchasing power parity (PPP) results is US $ 19.6 trillion, which is US $ 98 billion more than the US ’s GDP in the same year, ranking first in the world; exceeding Japan, Germany, the United Kingdom, France, and Italy. The total GDP of the country.

  However, judging from the GDP data for the first quarter of this year, according to the average exchange rate in the first quarter, China's GDP for the first quarter was about 2.96 trillion US dollars; while for the US it was 5.26 trillion US dollars, the difference between the two was 2.3 trillion US dollars. The United States is still the country with the largest GDP in the world.

  Why do the two show different results? Many statistical experts pointed out that this is caused by different statistical methods. For a long time, the international exchange rate method is mainly used to calculate GDP, but the World Bank's statistics are based on the purchasing power parity (PPP) method of GDP.

  Xu Xianchun, director of the China Economic and Social Data Research Center at Tsinghua University, pointed out that GDP calculated by the PPP method overestimates China's economic scale and per capita economic development level.

  Judging from the world rankings of GDP of major economies, compared with the results calculated by the exchange rate method, the world rankings of GDP calculated by the PPP method in developing countries have mostly jumped, and the rankings of developed countries have mostly moved backward.

  For example: China jumped from 2nd to 1st place; India jumped from 7th to 3rd place; Russia and Indonesia jumped from 6th and 10th places, respectively, from 10th place. The United States moved from first to second, Japan moved from third to fourth, and Germany, Britain, France, and Italy all moved backward.

  And the data shows that this round of global economic total calculated by the PPP method is significantly higher than the level calculated by the exchange rate method.

  Xu Xianchun pointed out that among them, the GDP growth rate calculated by the PPP method in developing countries is significantly higher than that in developed countries. There is an unreasonable component in this change in ranking and the difference in increase.

  The relevant person in charge of the Chinese Statistical Association also pointed out that the long-term international exchange rate method is simple and intuitive, and easy to understand. However, because the exchange rate mainly reflects the currency ratio of goods and services in international trade, price differences between countries are not considered, and the exchange rate is easily affected by fluctuations in international trade and financial markets. Therefore, when the exchange rate changes significantly Time, the results of comparison between countries will be affected.

  In order to overcome the impact of large fluctuations in the exchange rate law, starting in 1968, the United Nations Statistics Division and the University of Pennsylvania jointly launched the International Comparison Project (ICP) activity to measure the PPP of participating economies. So far, the world has carried out nine rounds of international comparisons.

  The relevant person in charge of the Chinese Statistical Association said that participating in the ICP survey is conducive to evaluating the status of China's economic aggregate in the world at multiple scales and improving China's statistical capabilities.

  Regarding the deviation caused by the use of PPP, the relevant person in charge of the Chinese Statistical Association believes that PPP is more suitable for comparison between economies with similar economic structures, and less suitable for comparison between economies with large differences in economic structures; Note that the PPP reliability of cargo products is better, and the PPP reliability of service products is worse. And PPP cannot replace the exchange rate.

  Although the GDP calculated by the PPP method ranks first in the world, China is still the largest developing country in the world.

  Xu Xianchun said that per capita GDP can better reflect the average living standard of the people. According to the PPP method, China's per capita GDP in 2017 was US $ 14,150, which is equivalent to 23.6% of the per capita GDP of Americans in the same year.

  According to the above-mentioned person in charge of the Chinese Statistical Association, according to the PPP method, China ’s per capita GDP only reached 85.3% of the world ’s average in 2017, ranking 90th in the world and falling back from the exchange rate ranking (79th) 11 people.

  According to the exchange rate method recognized by governments around the world, China's GDP in 2017 still ranks second in the world. In addition, China's PPP legal per capita consumption expenditure is lower than the world average, which is also in line with the general characteristics of developing countries. (Finish)