The forecast based on the latest study indicating that China’s economy is expected to surpass that of the U.S. in size this year has aroused international uproar.
The study conducted by World Bank's International Comparison Program (ICP), released on April 30 suggests that China's economy was nearly 87 percent of the size of the U.S. in 2011 by purchasing power parity (PPP) based measure, leaping from 43 percent in 2005, much bigger than previously thought.
Given the current growth rate of two countries, China's economy, in the measure of PPP at least, is likely to overtake that of the U.S. in size this year.
For the past few years, China surpassed Germany to be world’s largest exporter in 2009, outpaced Japan as world's second largest economy in 2010, and catched up with the United States to become the biggest trader last year.
In fact, as an unconventional statistical methods, PPP measurement remains a controversial way in economy ranking.
China's National Bureau of Statistics has expressed reservations about this methodology, according to the World Bank's statement.
As costs are much higher in the industrialized world, especially for non-traded goods, comparisons of GDP by PPP exchange rates tend to boost the relative size of poorer nations' economies.
In addition, PPP calculations are a statistical construction, based on complex surveys of baskets of goods in many countries. Some statistical errors may exist, said IMF.
There's a margin of error of 15 percent when using its data to compare economies of different sizes, ICP mentioned in a report.
Although China has overtaken some advanced countries in major economic indicators, there are still great challenges and complex problems in pushing forward economic and social development. It is not cause for complacency and it is far too early for declaring victory, according to an analyst with a leading economic research consultancy.
What China valued much more are the overall sustainability, wellbeing of people, harmony, soft power and influences among the globe, the analyst added.
Source: Xinhua
