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03/09/2009 Note: Lower level services data has been added to mock-up time series spreadsheets Table 11a and Table 11b with new series identifiers.
In addition, available from the Downloads tab of this issue are mock-ups of the International Trade in Goods and Services, Australia (cat. no. 5368.0) publication and related spreadsheets as they will appear following the implementation of the new standards.
An information paper (cat. no. 5302.0.55.002) describing the impact of the new international standards on the quarterly Balance of Payments and International Investment Position, Australia (cat. no. 5302.0) will be released on 22 July 2009. Similar information papers describing the impact on the national accounts will be released in July and August 2009.
In addition to these information papers, the ABS will progressively release technical papers describing in detail some of the compilation methodologies impacted by the new standards. When the new standards are implemented, the respective publications will contain a summary of the statistical impacts. Full details of these releases will be described in the relevant information paper.
CHANGES TO INTERNATIONAL STANDARDS
The international framework for economic statistics is centred around two key documents, the System of National Accounts, 1993 (SNA93) and the fifth edition of the Balance of Payments Manual (BPM5), both of which were released in 1993. Since the release of these key standards, a number of new economic phenomena have arisen or assumed greater importance as economies continue to develop in their complexity. In response to this, relevant international organisations and a range of national statistical agencies, including the ABS, have reviewed a range of conceptual and measurement issues that were either not clarified completely at the time of the release of SNA93 and BPM5, or have emerged as important measurement issues since that time. These issues are described in the Information Paper: Introduction of revised international standards in ABS economic statistics in 2009 (cat. no. 5310.0.55.001).
The international standards for national and international accounts were updated concurrently and the standards are compatible. The new standards are presented in the System of National Accounts 2008 and the sixth edition of the Balance of Payments Manual (BPM6). The Manual on Statistics of International Trade in Services is currently being revised and will reflect, as appropriate, changes to BPM6.
The revised international standards have not significantly changed the measurement of international trade in goods and services. The main changes are:
In addition, the ABS will incorporate the results of a number of data quality investigations into the BPM6 series including revised sources and/or methods for the transport freight, insurance and pension services and financial services (including FISIM) series. These investigation have taken account of any clarification provided by BPM6.
CHANGES TO GOODS AND SERVICES
The strict application of the change of ownership principle in BPM6 has resulted in the changes summarised in Table 1.
Table 1 - Changes to goods and services
The most significant of these changes is to goods for processing (which is renamed manufacturing services on physical inputs owned by others). An investigation by the ABS identified that the level of information available on export and import documentation lodged with the Australian Customs Service is not sufficient to adequately identify manufacturing services on physical inputs owned by others. As a result, the difference between goods imported for processing and goods exported after processing does not represent an appropriate processing fee. The current goods for processing series have been reviewed and the BPM6 series will be adjusted as appropriate to reflect an appropriate processing fee. This will result in some transactions currently included in goods for processing exports and imports being reallocated to non-monetary gold, silver and other related series. The manufacturing services on physical inputs owned by others series will be reviewed in more detail in the future to ensure that manufacturing services are adequately measured.
The goods procured in ports by carriers credits and debits series will be re-classified to general merchandise. This reclassification within goods will not change either total goods credits or total goods debits.
In addition to the changes described in Table 1, changes to the Extended Balance of Payments Services classification (EBOPS) will result in the following changes to the classification of services:
The BPM6 definition of economic territory no longer requires that persons, goods, and capital circulate freely within the territory. As a result of this change, Norfolk Island is now part of Australia's economic territory for the purposes of compiling the international and national accounts. This change was outlined as a key issue in the Discussion Paper: Proposed Standard Economic Sector Classifications of Australia (SESCA), 2008 (cat. no. 1218.0.55.001) which was released on 26 March 2009.
Australia's economic territory is the area under the effective control of the Australian government. It includes the land area, airspace, territorial waters, including jurisdiction over fishing rights and rights to fuels and minerals. Australian economic territory also includes territorial enclaves in the rest of the world. These are clearly demarcated areas of land, located in other countries and which are owned or rented by the Australian government for diplomatic, military, scientific or other purposes. Specifically, the economic territory of Australia consists of:
Because of administrative complexities and measurement difficulties, Norfolk Island transactions will not always be captured in all relevant ABS economic statistics. Most of the transactions involving Norfolk Island are not material to Australia's overall economic performance and not capturing these transactions will not distort the economic statistics. However, any significant transactions will be identified and included in the relevant statistics.
Changes to International Trade in Goods and Services, Australia resulting from the implementation of BPM6 will be implemented with the August 2009 issue which will be released on Tuesday, 6 October 2009. The new standards will also be reflected in the September quarter 2009 issue of Balance of Payments and International Investment Position, Australia which is consistent with the timing of the new standards being implemented in the Australian national accounts.
To accommodate additional processing required to compile the balance of payments and international investment position time series according to the revised standards, the release of the September quarter 2009 issue of Balance of Payments and International Investment Position, Australia will be delayed one week until Tuesday, 8 December. Due to this delay and additional time required to compile the national accounts according to the revised standards, the September quarter 2009 issue of Australian National Accounts: National Income, Expenditure and Product (cat. no. 5206.0) will be delayed two weeks until Wednesday, 16 December 2009. Future issues of these publications will be released according to the standard timing
Annual trade in services series (country, state and detailed service type) are usually released with the September issue of International Trade in Goods and Services, Australia for financial year (cat. no. 5368.0.55.003) and the March issue for calendar year (cat. no. 5368.0.55.004). With the implementation of BPM6, financial year data will be released, as normal, with the September issue. Calendar year data to 2008, on a BPM6 basis, will be released with the October 2009 issue of International Trade in Goods and Services, Australia.
IMPACT ON TIME SERIES
From the August 2009 issue of International Trade in Goods and Services, Australia goods and services data will be presented on a BPM6 basis. The changes being implemented with BPM6 will not generally impact on the value of total goods and services. However, data quality improvements will result in a shift in the level of some series. To maintain the integrity of time series, level shifts will be backcast. The length of backcasting varies for individual series but the monthly goods series will not be revised prior to July 1971 and the monthly services series will not be revised prior to July 1983.
The individual series which will be revised are listed in Tables 2 to 4.
Table 2 - Goods credits series which will be revised
Table 3 - Goods debits series which will be revised
Table 4 - Services credits and debits series which will be revised
Chart 1 below shows the net impact on the balance on goods and services of the revisions to historical series as a result of the above changes. While the net impact on the balance on goods and services is not significant, the impact on some of the individual series listed above will be greater. Details of the impact on key aggregates of implementing BPM6 will be described in the August 2009 issue of International Trade in Goods and Services, Australia.
KEY CHANGES TO OUTPUTS
The standard BPM6 presentation for goods is not very detailed and will be supplemented by the current more detailed ABS classifications of goods credits and debits, changed as appropriate to take into account BPM6 changes. The only BPM6 supplementary items for goods, re-exports on BoP basis, will not be shown but an equivalent item is available on a recorded trade basis.
The standard BPM6 presentation for services will be adopted as fully as practicable. The major divergence is for transport services but in a number of cases more detail will be provided than required by BPM6. Memorandum items for insurance premiums and claims will be included to achieve consistency between International Trade in Goods and Services, Australia and the quarterly publication.
The key changes to the tables in the International Trade in Goods and Services, Australia publication are:
BPM6 will not result in any change to the format of Tables 12 to 15 which present goods data on a recorded trade basis. However:
MOCK-UPS OF THE PROPOSED PUBLICATION AND THE RELATED SPREADSHEETS
Available from the Downloads tab of this publication are:
Details of changes to each table are described in the Key changes to outputs section, above.
TIME SERIES IDENTIFIERS
The changes described above will result in new time series identifiers for some series.
CONCEPTS, SOURCES AND METHODS
Balance of Payments and International Investment Position, Australia: Concepts, Sources and Methods (cat. no. 5331.0) describes the underlying concepts and structure of the balance of payments and the sources, methods and terms used in compiling the estimates. The current version of this publication reflects BPM5 concepts and a number of references to data sources and methods are, or will be, out-of-date. A revised Concepts, Sources and Methods publication is scheduled for release in late 2010.
The publications impacted by the implementation of BPM6 include:
The international standards are described in:
Related information papers to be released or already released include:
If you would like further information please contact Selvi Sekhar on (02) 6252 5540 for goods, and Karen McGuigan on (02) 6252 5415 for services.
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