Sub-Regional Workshop on International Merchandise Trade Statistics Compilation and Export and Import Unit Value Indices 21 – 25 November 2016. Guam Reef & Olive Spa Resort, Tamuning, Guam COMMODITY CLASSIFICATION Presentation by Nilima Lal Economic Statistician, Pacific Community Email: NilimaL@spc.int

The need for a commodity classification The use of commodity classification: Identifies commodities Regional and international consistency Provides the way for various customs, statistical and analytical purposes and trade negotiations.

The different classifications Classifications used for IMTS Harmonized Commodity Description and Coding System (HS) Standard International Trade Classification (SITC) Classification by Broad Economic Categories (BEC) Nomenclatures have also been elaborated with the primary aim of classifying productive economic activities: International Standard Industrial Classification of All Economic Activities (ISIC) Central Product Classification (CPC) The need for different classifications: Analytical needs vary

Chapters arranged into 1,224 Headings HS Based on the nature of the commodity. Latest version is the HS12 which comprises: Example 21 Sections Split into 96 Chapters Chapters arranged into 1,224 Headings SECTION I LIVE ANIMALS; ANIMAL PRODUCTS CHAPTERS 1-5 Chapter 1 Live animals HEADINGS 0101-0106 Heading 0103 Live swine

SITC Takes into account the stage of production and is considered more suitable for economic analysis Latest version is the Revision 4 which comprises: All goods in HS except monetary gold, gold coin and current coin. It contains 2970 basic headings grouped into 1023 subheadings Subheadings are assembled in 262 groups, 67 divisions and 10 sections: SECTIONS DESCRIPTION 0 Food and live animals Beverages and tobacco Crude materials, inedible, except fuels Mineral fuels, lubricants and related materials Animal and vegetable oils, fats and waxes Chemicals and related products, not elsewhere specified Manufactured goods classified chiefly by material Machinery and transport equipment Miscellaneous manufactured articles Commodities and transactions not classified elsewhere in SITC

BEC It converts trade data compiled into end-use categories that are meaningful within the framework of SNA. The three basic classes of goods in SNA are: capital goods intermediate goods consumption goods. Latest version is the Revision 3 which comprises 19 basic categories and 7 sections: SECTIONS DESCRIPTION 1. Food and beverages 2. Industrial supplies not elsewhere specified 3. Fuels and lubricants 4. Capital goods (ex transport equipment), and parts and accessories thereof 5. Transport equipment, and parts and accessories thereof 6. Consumer goods not elsewhere specified 7. Goods not elsewhere specified These sections are broken down, as applicable, by other criteria such as primary and processed goods, durable, semi-durable, and non-durable goods, etc.

ISIC PACSIC Not a product classification. Classifies statistical units, such as establishments or enterprises, according to the principle economic activity in which they engage: - principal industry of origin of products: acceptable approximation of export commodity but difficult for imports Latest version is Revision 4 which comprises: tabulation categories identified by letters, called “sections” the 2‑digit categories “divisions” the 3‑digit categories “groups” 4‑digit categories “classes” Sub-classes

CPC Combines the main classification principles of ISIC with criteria applied in HS Latest is Version 2 which comprises: 10 sections 71 divisions 324 groups 1,267 classes and 2,738 subclasses. Trade data expressed in terms of CPC facilitates its use in economic analysis including in the assessment of the impact of external trade on the consumption

Relationship between different classifications Activity classification Product classification Mainly use for production Mainly use for merchandise trade ISIC CPC SITC BEC For trade analysis For data collection and analysis HS

Correspondence tables All classifications are closely related: Correspondence tables describe the relationship between different classifications e.g. HS to CPC different versions of the same classification e.g. HS07 to HS12 The United Nations Statistics Division website provides access to the classifications relevant to international merchandise trade statistics, including correspondence and conversion tables Onions CPC 01253 HS 0703.10 ISIC 0113 SITC 054.51 BEC 112*

Recommendation for PICTs HS for the collection, compilation and dissemination of IMTS In addition SITC for the dissemination and analysis of trade statistics according to user requirements BEC for retained imports - use in National Accounts Use most current versions of the classifications