Explanatory Notes on Main Statistical Indicators

Gross Domestic Product (GDP) refers to the final products produced by all resident units in a country during a certain period of time. Gross domestic product is expressed in three different perspectives, namely value, income, and products respectively. GDP in its value perspective refers to the balance of total value of all goods and services produced by all resident units during a certain period of time, minus the total value of input of goods and services of the nature of non-fixed assets; in other words, it is the sum of the value-added of all resident units. GDP from the perspective of income refers to the sum of all kinds of revenue, including Compensation of Employees, Net Taxes on Production, Depreciation of Fixed Assets, and Operating Surplus. GDP from the perspective of products refers to the value of all goods and services for final demand by all resident units plus the net exports of goods and services during a given period of time. In the practice of national accounting, gross domestic product is calculated from three approaches, namely production approach, income approach and expenditure approach, which reflect gross domestic product and its composition from different angles.

For a region, it is called as Gross Regional Product(GRP) or regional GDP.

Three Strata of Industry Classification of economic activities into three strata of industry is a common practice in the world, although the grouping varies to some extent from country to country. In China, according to Industrial classification for National Economic Activities (GB/T 4754¡ª2011), economic activities are categorized into the following three strata of industry:

Primary industry refers to agriculture, forestry, animal husbandry and fishery industries (not including services in support of agriculture, forestry, animal husbandry and fishery industries).

Secondary industry refers to mining and quarrying(not including support activities for mining), manufacturing(not including repair service of metal products, machinery and equipment), production and supply of electricity, heat, gas and water, and construction.

Tertiary industry refers to all other economic activities not included in the primary or secondary industries.

GDP by Expenditure Approach refers to the method of measuring the final results of production activities of a country (region) during a given period from the perspective of final uses. It includes final consumption expenditure, gross capital formation and net export of goods and services.

GDP by expenditure approach = final consumption expenditure + gross capital formation + net export of goods and services

Final Consumption Expenditure refers to the total expenditure of resident units for purchases of goods and services from both the domestic economic territory and abroad to meet the needs of material, cultural and spiritual life. It does not include the expenditure of non-resident units on consumption in the economic territory of the country. The final consumption expenditure is broken down into household consumption expenditure and government consumption expenditure.

Household Consumption Expenditure refers to the total expenditure of resident households on the final consumption of goods and services. In addition to the consumption of goods and services bought by the households directly with money, the household consumption expenditure also includes expenditure on goods and services obtained by the households in other ways, i.e. the so-called imputed consumption expenditure, which includes the following: (a) the goods and services provided to households by employers in the form of payment in kind and transfer in kind; (b) goods and services produced and consumed by the households themselves, in which the services refer to the owner-occupied housing and services offered by payed family employees; (c) financial intermediate services provided by financial institutions.

Government Consumption Expenditure refers to the consumption expenditure spent for the provision of public services provided by the government to the whole country and the net expenditure on the goods and services provided by the government to households free of charge or at reduced prices. The former equals to the output value of the government services minus the value of operating income obtained by the government departments. The latter equals to the market value of the goods and services provided by the government free of charge or at reduced prices to the households minus the value received by the government from the households.

Gross Capital Formation refers to the fixed assets acquired minus disposals and the net value of inventory, thus including gross fixed capital formation and changes in inventories.

Gross Fixed Capital Formation refers to the value of acquisitions less those disposals of fixed assets during a given period. Fixed assets are the assets produced through production activities with unit value above a specified amount and which could be used for over one year. Natural assets, consumer durables, small instruments are not included. Gross Fixed Capital Formation includes the value of housing, other buildings and structure, equipment and machinery, breeding biological resources, intellectual property right product (expenditure for R&D, the prospecting of minerals and the acquisition of computer software) minus the disposal of them.

Changes in Inventories refers to the market value of the change in the physical volume of inventory of resident units during a given period, i.e. the difference between the values at the beginning and at the end of the period minus the gains due to the change in prices. The changes in inventories can have a positive or a negative value. A positive value indicates an increase in inventory while a negative value indicates a decrease in inventory. The inventory includes raw materials, fuels and reserve materials purchased by the production units as well as the inventory of finished products, semi-finished products and work-in-progress.

Public Economy refers to the economic components owned by the national or citizen of the collective economic components, including the state-owned economy and collective economy.

Private Economy (ie, non-public Economy) refers to the economic components owned by private citizens in the Mainland of China and naturalized by Hong Kong, Macao and Taiwan entrepreneurs, including the Self-employed Individuals, private economy, Hong Kong, Macao and Taiwan Economy and foreign economy.