Luxembourg, December 12th 2014 Global production Country experience: Netherlands Luxembourg, December 12th 2014

Scheme: Link between ITGS and national accounts 2011 (mln euro)   Import (cif/fob) Export (fob) Balance ITGS (national concept) 364.922 409.358 44.436 1. Conceptual changes -20.810 -13.691 7.119 a. Merchanting 6.254 b. Production abroad 5.662 13.239 7.577 c. Goods sent for processing -22.363 -29.254 -6.891 d. Affiliated establishments -4.109 -3.930 179 2. Corrections for exhaustiveness 2.521 8.049 5.528 a. Goods returned to sender -2.059 b. Goods procured in ports by carriers 3.307 7.734 4.427 c. Online trade 419 195 -224 d. Sales of international org. 216 e. Illegal activities 854 1.963 1.109 3. Other corrections -1.526 -2.189 -663 National accounts before balancing 345.107 401.527 56.420 4. Balancing corrections 264 -2.783 -3.047 National accounts after balancing (imports cif) 345.371 398.744 53.373 5. Cif/Fob-adjustment and reclassification -11.548 11.548 National accounts after balancing (imports fob) 333.823 64.921

Processing (1) Sources used for final estimates of reporting year: ITGS: Nature of Transaction codes are incomplete SBS: Estimate of trade in processing services with a breakdown to industry Inward processing (large enterprises): Bottom-up approach, i.e. adjustments are made for each statistical unit Inward processing (small and medium-sized enterprises) & outward processing: Top-down approach, i.e. imputations for trade in services are made for each industry with adjustments to trade in goods for corresponding cpa codes ITG transactions related to processing removed under the condition that the balance of trade in goods and services does not change

Processing (2) Numerical example bottom-up approach (large inward processers): Enterprise X: Resident that supplies processing services   Imports Exports SBS Export of processing serv. 20 ITG Import of tabacco -60 Export of cigarettes -70 Imputation Import of cigarettes 10 = 80-70 Trade balance -50 Prodcom Production of cigarettes 80

Processing (3) Numerical example top-down approach for SME (inward processing) and outward processing: INDUSTRY A: Exports of processing services    Imports Exports SBS Export of processing serv. 20 ITG Commodity A, NoT 4 -60 Commodity B, NoT 5 Assumption Export of commodity B -80 = -60-20 Trade balance

Merchanting Sources used for final estimates of reporting year: SBS of NACE 46 (whosesale trade) contains estimates of merchanting Other industries don’t provide a breakdown of exports of wholesale trade activities Assumption: Share of merchanting in wholesale trade in industries other than NACE 46, is identical to the share of merchanting in wholesale trade in NACE 46 (5 digit- level). An example: The share of merchanting in wholesale trade of an oil refinery (NACE 19) is assumed to be identical to the share of merchanting in wholesale trade of a trader in oil products (NACE 46.71)

Other global manufacturing activities (1)   Processing activities Physical movement of goods A: Principle (reporting economy) B: Processor C: Third country Scenario 1: No leakages Scenario 2: Leakages Scenario 3: Goods do not cross border of country A (Production abroad) A B A B C A B C

Other global manufacturing activities (2) Production abroad: Flow of goods not recorded in ITGS; Goods have to be imputed Sources for final estimates reporting year: In SBS entities report how much they produce on own account in other countries and the amount of inputs used in the production process abroad Confrontation with Prodcom and financial statistics to check the plausibility of the results CPA breakdown of output and intermediate use in SBS and Prodcom used to make breakdown to commodities in Supply and Use Table

Measurement issues (1) Processing, flow of goods: NoT codes far from complete and only available on 1-digit level, thus no leakages measured No alternative sources for processing related movement of goods Quarterly and provisional annual estimates: Follow the development of similar commodities in ITGS. Processing, services: SBS data only available two years after end of reporting year From 2012 onwards, processing services measured by Survey of Trade in Services on quarterly basis Consistency between processing service measured and balance of trade of goods removed from ITGS

Measurement issues (2) Merchanting: SBS only contains merchanting data for wholesale trade (NACE 46) Since 2014 the Survey of Trade in Services (quarterly survey) includes the gross flows of goods related to merchanting First results are encouraging, the total gross flow of goods (purchases and sales) are in line with the estimates made with SBS Further analysis needed to compare the results for individual respondents

Measurement issues (3) Production abroad: SBS data only available two years after end of reporting year Alternative sources: Consistency Unit compares the trade of enterprise groups as reported in the Statistics of Finances of Large Enterprises (SFGO) with the trade reported in the ITGS Provisional figures SFGO available 12 months after end of reporting year Quarterly and provisional annual estimates: Follow the development of similar commodities in ITGS