Chapter 3 Supply Table (SUT Handbook)

1. Chapter 3Supply Table (SUT Handbook) Derek Blades Resource Person May 2014

2. Contents • Domestic Production • Special cases • Governmentand NPISH grossoutput (CFC) • Retailersand wholesalers • Bank output • Insuranceoutput • Basic Prices and Purchasers’ Prices • Transport costs and trade margins • C.i.f. / f.o.b. adjustment • Taxes and subsidies on products • Purchases abroad by residents and purchases in the domestic market by non-residents • Missing values • Poultry meat – household consumption ,transport costs, trade margins, inventories

3. Basic prices and Purchasers’ prices

4. Transport costs and trade margins • Since freight transport costs and trade margins are now shown in columns in the Supply quadrant, there is a problem of double counting because trade and freight transport services are also included in the list of commodities that are produced or imported. Figure 3 in the text shows the counter-entries that are required to avoid double counting.

5. C.i.f. / f.o.b. adjustment In the SNA, both imports and exports are theoretically valued f.o.b. In practice exports are so valued but almost all countries record imports c.i.f. When imports are valued c.i.f. there is another double counting problem: The value of imported goods includes the transport and insurance services incurred in bringing them to the importing country, but these transport and insurance services will also be included either in domestic production if the transport and insurance services are provided by residents, or in imports (of services) if the transport and insurance services are provided by non-residents. Figure 4 in the text shows the adjustments required to avoid double counting freight and insurance services when, as is usually the case, imports are recorded c.i.f. Both an additional column and an additional row have to be introduced into the supply quadrant of the SUT.

6. Purchases abroad by residents and purchases in the domestic market by non-residents • In the SNA, household final consumption expenditure (HFCE) refers to the resident population. This means that: • HFCE must include purchases abroad by residents and exclude purchases in the domestic market by non-residents. • Exports must include purchases in the domestic market by non-residents, and imports must include purchases abroad by residents.

7. Questions - omissions Is the chapter clear? Does it help? Anything else to add?

8. Thank you