BILL SAVADOVE in Shanghai

The mainland economy grew 12.9 per cent in the first nine months of this year based on local government statistics, more than three percentage points higher than the national figure.

Of the mainland's 31 municipalities, provinces and regions, only one - Henan province - had gross domestic product growth below the official figure of 9.5 per cent for the first three quarters.

The difference between data provided by the provinces and the central government again raised questions about the accuracy of China's GDP figures.

Some analysts say the central government could be understating GDP because of political pressure to show that policies to control the economy are achieving success.

But others warn provincial figures are even less reliable because local officials overstate growth to earn praise or base their reporting on flawed data.

Beijing started doing its own sampling in 1998, though the National Bureau of Statistics has never revealed how it calculates GDP.

For the first nine months, Inner Mongolia took the top spot with GDP up 21.8 per cent, though officials say the data has discrepancies so it might not be the final figure. Booming coastal cities and provinces like Tianjin and Shandong filled the top five.

The statistics bureau defends its own GDP figures, saying the provincial numbers are calculated differently. "They aren't the unified figures approved by the bureau," an official said.

While only Henan reported GDP growth below the national figure, the province's commerce department gave a different figure, putting GDP growth at 14.2 per cent.

To some economists, provincial data suggests an economy racing out of control, even as the central government tries to rein in growth.

Bert Keidel, a senior associate at the Carnegie Endowment for International Peace, traces the economy's overheating to as early as 2001.

He estimates GDP growth was 9.5 per cent in 2001, 9.8 per cent in 2002 and 11.1 per cent last year using the expenditure method. This compares with official figures of 7.5 per cent in 2001, 8.3 per cent in 2002 and 9.3 per cent last year, according to the China Statistical Yearbook.

"This says to me that the quarterly data are almost certainly understated," said Professor Keidel, a former senior World Bank economist in Beijing.

A debate over the accuracy of the figures erupted in 2001 when Thomas Rawski of the University of Pittsburgh said statistics since 1998 appeared to be exaggerated.

Carsten Holz, a professor at the Hong Kong University of Science and Technology, said he saw no proof the figures were falsified, rather that there was a large margin of error. He estimates annual growth rates are accurate to a 1.5 percentage point band 70 per cent of the time.

Still, Professor Holz said some provinces were not heeding the central government's advice to slow their economies. "It just takes time. I'm not terribly worried about the landing, it's just how hard or how soft it will be," he said.

Additional reporting by Minnie Yang