SHANGHAI (Reuters) - China is planning to overhaul the system used to measure the health of the world's second largest economy to bring it in line with global standards, according to the country's National Bureau of Statistics (NBS).

China's economic data are widely seen as unreliable. Premier Li Keqiang has previously said the country's gross domestic product (GDP) was "man-made" and therefore unsound, according to U.S. diplomatic cables released by WikiLeaks.

The proposed revisions would bring China's accounting methods in line with the 2008 United Nations System of National Accounts. The current version dates back to 1993, NBS vice head Xu Xianchun told the official Xinhua news agency on Monday.

The new system, if implemented, would come online by the end of 2014 at the earliest, Xu said in the interview.

The changes would mean that spending on research and development would be counted as a form of fixed capital, and therefore would be included into GDP calculations, Xu added.

China's GDP data is closely watched by global markets.

In the first nine months of the year, the $8.5 trillion economy grew 7.7 percent from a year earlier, putting it on track to achieve Beijing's 2013 growth target of 7.5 percent, which would still be China's worst performance in 23 years.

The proposed changes would also see new methods for determining the value for some self-owned housing, would amend the calculation of farmers' income and create an index for employee stock options as a form of labour wage.

Historical GDP data will also be revised according to new standards and released after the ongoing third national economic census, Xu said.

China unwrapped its boldest set of economic and social reforms in nearly three decades last week, relaxing its one-child policy and further freeing up markets in order to put the economy on a more stable footing.

(Reporting by Adam Jourdan; Editing by Himani Sarkar)