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          BIZCHINA> Review & Analysis
          End obsession with GDP
          (China Daily)
          Updated: 2006-05-26 09:11

          The suggestion that local gross domestic product (GDP) growth could be allowed to fall below zero points to a pragmatic approach in terms of drawing up policies to attain balanced development.

          The political career of officials should not be affected by a low local GDP growth rate.

          Making this proposal, the China Economic Monitoring Centre of the National Bureau of Statistics (NBS) says it will encourage local officials to strike a balance between economic growth and the environment.

          High-rate economic growth is necessary for China to improve its national strength and its people's living standards. But it has been translated into a de facto "GDP-mania," with the political careers of many government officials hinging on the local GDP growth rate.

          Some officials even play the numbers game to inflate GDP figures in order to secure promotion.

          Prioritizing economic growth at the expense of environmental, social and cultural factors has had serious consequences.

          The central government has made it clear in the 11th Five-Year Plan (2006-10) that it will seek balanced development and place equal emphasis on economic growth and environmental protection.

          But a fundamental change to the career appraisal system for government officials is required in order to achieve this. And that requires far less importance to be attached to GDP growth.

          If implemented, the proposal made by the NBS would be a significant step in the right direction.

          It will play the role of a "carrot," a pragmatic method to encourage local officials to strike a balance between economic growth and the environment, even if that means GDP growth is temporarily held in check.

          On the other hand, such a "carrot" must also be accompanied by a "stick." Without administrative and legal arrangements to deal with those who sacrifice the environment to achieve GDP growth or simply inflate GDP figures, such an offer of a "carrot" would hardly work in tackling GDP-mania.

          It is regretful that a few officials have been demoted for their failure to report truthful statistics.

          A career appraisal system must be developed that punishes dishonest officials and rewards honest ones.

          Moreover, since it lacks concrete measures to punish statistical violations by government officials, the Statistics Law must incorporate more detailed, enforceable stipulations to hold those wrongdoers to account.

          It is under revision now. Vital changes should be made to give it teeth.


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