Central authorities to count cost of exaggerated local performance

INSTEAD OF THE LOCAL GOVERNMENTS, the central authorities will now produce the provincial GDP figures. Beijing News comments:

The sum of all the provincial GDP figures has been markedly higher than the national GDP since 1996. Last year, the gap was nearly 2.8 trillion yuan ($413 billion).

Before Wang Baoan, the former head of the National Bureau of Statistics, was sacked for corruption in January 2016, the bureau attributed the gap to technical reasons.

But it is an open secret that the provincial governments are used to exaggerating local economic performance, as it is one of the most important criteria for assessing the performance of local officials.

After Wang Min, the former Party chief of Liaoning province, was investigated for power abuse and graft, the Liaoning provincial government in Northeast China admitted earlier this year that it falsified the province’s financial statistics from 2011 to 2014.

For a long time, local officials have had more opportunities for promotion by magnifying their economic data.

And in 2013, Ma Jiantang, the former head of National Bureau of Statistics prior to Wang, pointed out some local governments intervened in the reports enterprises submitted to the bureau, either by fabricating the enterprises’ data themselves, pressuring the enterprises to report false figures, or replacing the enterprises’ reports with ones they produced themselves.

Since the GDP figures are of such importance, influencing not only the making of national macroeconomic policies but also the quality of local governance, it is a positive and welcome move that not only will the central government check the reports and calculate the GDP of the provinces directly, but it will also increase the severity of the punishments meted out to those who falsify the figures.