Dec 27 2024: China announced on Friday that its 2023 gross domestic product (GDP) was revised upward due to a shift in housing sector calculation methods, a change expected to influence the economy’s size in 2024 but have minimal effect on growth rates.
On Thursday, the National Bureau of Statistics (NBS) reported a 3.4 trillion yuan ($17.73 trillion) upward adjustment to the 2023 GDP, representing a 2.7% increase. Initially, no explanation was provided, but the bureau clarified on Friday that the revision stemmed from switching to rental values instead of the previously used housing cost calculation method.
This adjustment increased the housing services sector’s contribution to GDP by 1.34 trillion yuan. The NBS explained that the former “housing cost method” factored in property depreciation, maintenance, management fees, and taxes, which understated the sector’s output due to incomplete rental market data in the past.
The revision boosted the share of tertiary industries—such as retail, transport, finance, and property—in economic output to 56.3% in 2023, a 1.7 percentage-point increase from initial data.
While the revision raises the GDP size, the NBS emphasized that it would not significantly affect the growth rate.
Economic Outlook Amid Challenges
China’s economy has faced significant headwinds in 2023, including a prolonged property sector crisis, substantial local government debt, and weak consumer demand.
At a recent economic planning meeting, Chinese leaders pledged to bolster growth in 2024 by increasing the budget deficit, issuing more debt, and loosening monetary policy. The measures aim to counter economic challenges and anticipated trade tensions with the U.S. under President-elect Donald Trump’s administration.
Notably, the government plans to issue 3 trillion yuan ($411 billion) in special treasury bonds in 2024, a record-high figure, to support economic recovery efforts.
($1 = 7.2982 Chinese yuan)
