📈 Preliminary Accounting Results of Gross Domestic Product for the Second Quarter and the First Half of 2024

According to relevant basic data and the methods of Gross Domestic Product (GDP) accounting, the preliminary accounting results of China's GDP for the second quarter and the first half of 2024 are as follows:

📊 GDP Accounting Overview

1. Basic Concepts

GDP is the ultimate outcome of the production activities of all resident units in a country within a certain period. It is the core indicator of national economic accounting and an important measure of a country's economic conditions and development level.

There are three methods of GDP accounting: production approach, income approach, and expenditure approach. These methods reflect the results of national economic production activities from different perspectives.

The production approach involves calculating the value added by subtracting the value of intermediate goods and services used in the production process from the value of goods and services created in the production process. The calculation formula for the production approach is: Value Added = Total Output - Intermediate Input. The sum of the value added of each industry in the national economy is the GDP calculated by the production approach.

The income approach accounts for the results of production activities from the perspective of income formed in the production process. According to this method, the value added consists of four parts: compensation of employees, net product taxes, fixed asset depreciation, and operating surplus. The calculation formula is: Value Added = Compensation of Employees + Net Product Taxes + Fixed Asset Depreciation + Operating Surplus. The sum of the value added of each industry in the national economy calculated by the income approach equals the GDP calculated by the income approach.

The expenditure approach calculates the GDP from the perspective of the final use of the results of production activities. The final use includes final consumption expenditure, gross capital formation, and net exports of goods and services.

The quarterly GDP released by the National Bureau of Statistics is based on the results calculated by the production approach.

2. Accounting Scope

The production scope of GDP accounting includes the following four parts:

1. The production of goods or services provided or intended to be provided to other units by producers.
2. The self-supply production of all goods used by producers for their own final consumption or the formation of fixed capital.
3. The self-supply production of knowledge carrier products for producers' own final consumption or the formation of fixed capital, excluding similar activities undertaken by the household sector.
4. The housing services provided by owner-occupied housing and the self-supply production of family and personal services provided by paid domestic service workers.

The production scope does not include unpaid family and personal services, natural activities not controlled by units (such as the natural growth of wild forests, wild fruits or berries, the natural increase in the number of fish in the high seas), etc.

3. Accounting Unit

GDP accounting mainly uses legal person units as the accounting unit. In the accounting, legal person units are classified into different industries based on their main activities, and the value added of each industry is calculated separately. The GDP is then obtained by summing up the value added of each industry.

4. Accounting Frequency

The accounting frequency is quarterly. China started to calculate the quarterly GDP by cumulative accounting method from the first quarter of 1992 to the second quarter of 2015, that is, calculating the GDP data for the first quarter, 1-2 quarters, 1-3 quarters, and 1-4 quarters of each year, and the preliminary accounting of the GDP for 1-4 quarters is the preliminary accounting of the annual GDP. Since the third quarter of 2015, the quarterly accounting method has been changed to calculate the GDP data for the first quarter, second quarter, third quarter, and fourth quarter of each year, and the cumulative data is obtained by adding the data of the current quarter.

Since the first quarter of 2011, the National Bureau of Statistics has officially released the quarterly GDP growth rate.

5. Legal Basis and System Regulations

GDP accounting strictly complies with the provisions of the "Statistical Law of the People's Republic of China". At present, China's GDP is calculated in accordance with the requirements of the "Chinese National Economic Accounting System (2016)", which adopts the basic accounting principles, content, and methods of the United Nations "System of National Accounts (2008)".

6. Confidentiality

In accordance with Article 9 of Chapter I of the "Statistical Law of the People's Republic of China", statistical institutions and statistical personnel shall keep confidential state secrets, commercial secrets, and personal information known in the statistical work.

National economic accounting personnel strictly keep confidential the professional statistical data and administrative records used in GDP accounting, and strictly keep confidential the GDP data of the current period before the release of the GDP accounting data.

7. User Needs

The domestic users of quarterly GDP data are mainly government departments, research institutions, universities, industry associations, media, and the public. In addition, the National Bureau of Statistics regularly provides China's quarterly GDP data to international organizations such as the United Nations, the International Monetary Fund, the Organization for Economic Cooperation and Development, and the Asian Development Bank.

8. Quarterly GDP Accounting Methods

In the quarterly GDP accounting, the industry is divided according to the Chinese national economic industry classification standard and the three industry division standards, and two classification methods are adopted.

The first classification is the national economic industry classification, which adopts the "National Economic Industry Classification (GB/T 4754-2017)" issued by the national standard management department in 2017. In actual accounting, a two-level classification is used.

The first-level classification is based on the categories in the national economic industry classification, divided into agriculture, forestry, animal husbandry, and fishery, industry, construction, wholesale and retail trade, transportation, warehousing and postal services, accommodation and catering services, finance, real estate, information transmission, software and information technology services, leasing and business services, and other industries, etc. 11 industries. Among them, industry includes mining, manufacturing, electricity, heat, gas and water production and supply industry, etc. 3 category industries; other industries include scientific research and technical services, water conservancy, environmental and public facility management, residential services, repair and other services, education, health and social work, culture, sports and entertainment, public management, social security and social organizations, etc. 7 category industries.

The second-level classification refines some categories in the national economic industry classification into industry categories on the basis of the first-level classification.

The second classification is the three industry classification, which is divided into the primary industry, secondary industry, and tertiary industry according to the "Three Industry Division Regulations" revised by the National Bureau of Statistics in 2018. The primary industry refers to agriculture, forestry, animal husbandry, and fishery (excluding professional and auxiliary activities in agriculture, forestry, animal husbandry, and fishery); the secondary industry refers to mining (excluding professional and auxiliary activities in mining), manufacturing (excluding metal products, machinery and equipment repair industry), electricity, heat, gas and water production and supply industry, construction industry; the tertiary industry is the service industry, which refers to other industries other than the primary industry and secondary industry (excluding international organizations).

9. Data Sources

In the quarterly GDP accounting, all economic statistical survey data that can be obtained and applicable at the time of accounting are used for GDP accounting. The data sources mainly include two parts:

1. National statistical survey data, which refers to various statistical data obtained by the national statistical system through statistical surveys, such as statistical survey data of agriculture, forestry, animal husbandry, and fishery, industry, construction, wholesale and retail trade, accommodation and catering services, real estate, scale above service industry, population and labor wage statistical data, price statistical data, etc.
2. Administrative records of administrative management departments, mainly including relevant data from administrative management departments such as the Ministry of Finance, the People's Bank of China, the State Administration of Taxation, the China Securities Regulatory Commission, etc., such as the financial institutions' foreign currency credit and debit situation of the People's Bank of China, the tax data by industry of the State Administration of Taxation, etc.

10. Accounting Methods

10.1 Current Price Value Added