Implications of globalisation for economic statistics Trade measurement issues

1. Implications of globalisation for economic statisticsTrade measurement issues Art Ridgeway Balance of Payments Division July 2007

2. Outline • Trade – Ownership & Physical Flows • Organization of Production • Economic data for supply chains Balance of Payments Division Statistics Canada

3. Goods Trade – The New World • Goods for Processing • Cross border flow ≠ Ownership change • Goods vs. services • Valuation of flows • Consistency with banking • Merchanting • Ownership change without cross border flow • Inventories are outside country of owner • Banking flows with no imports or exports Balance of Payments Division Statistics Canada

4. Canada Canada United States United States Company A Company A Goods for processing Goods for processing Company B Company B Finished Goods Finished Goods Service included in Finished Goods Processing Service Cash = value of service Cash = value of service Goods for Processing Current Treatment ForthcomingConvention Balance of Payments Division Statistics Canada

5. Country A Merchanting (International Wholesaler) Inventories Country B Country C Supplier Customer Merchanting Balance of Payments Division Statistics Canada

6. Head Office (Finance, Development, Marketing) (Ancillary) Manufacturing establishment Inventories Materials Finished Goods Component Supplier Final Market Traditional View of Goods Production Balance of Payments Division Statistics Canada

7. Head Office (Finance, Development, Marketing) Inventories Materials Finished Goods Component Supplier Processor Final Market Outsourcing Production for Export market – Economic Flows Balance of Payments Division Statistics Canada

8. Data Challenges • Taking the four economies in turn look at data needs for each case • Customs data • Production surveys • establishments - local units • Financial surveys • enterprises • Trade in services Balance of Payments Division Statistics Canada

9. Econ IV Head Office (Finance, Development, Marketing) Inventories Materials Finished Goods Econ I Econ II Econ III Component Supplier Processor Final Market Economy I Balance of Payments Division Statistics Canada

10. Econ IV Head Office (Finance, Development, Marketing) Inventories Materials Finished Goods Econ I Econ II Econ III Component Supplier Processor Final Market Economy III Balance of Payments Division Statistics Canada

11. Econ IV Head Office (Finance, Development, Marketing) Inventories Materials Finished Goods Econ I Econ II Econ III Component Supplier Processor Final Market Economy II Balance of Payments Division Statistics Canada

12. Econ IV Head Office (Finance, Development, Marketing) Inventories Materials Finished Goods Econ I Econ II Econ III Component Supplier Processor Final Market Economy IV Balance of Payments Division Statistics Canada

13. Data Source Research • Customs data • Additional use of information on customs forms • Production surveys • Questions on outsourcing or off shoring • Inventories within and outside the country • Trade in Services • Better data on processing and merchanting Balance of Payments Division Statistics Canada

14. Data Integration • Improved coordination of estimates for • Goods trade • Services trade • Production • Improved integration in building • National Accounts • Balance of Payments Balance of Payments Division Statistics Canada