1 The 5 th revision of the Classification of Broad Economic Categories (BEC) Ronald Jansen Chief of the Trade Statistics Branch United Nations Statistics Division / DESA

2 Reference documents Note to the EG Report of the Global Consultation Draft Manual of BEC, 5 th revision, version June 2014 Expert Group on Classifications

3 Content of Draft Manual I.Historical Background II.Reasons for revising the BEC III.The structure of the BEC, 5 th revision IV.The compilation of the BEC V.The analytical use of the BEC VI.The relationship to other classifications VII.The relationship to earlier versions Expert Group on Classifications

4 History of the BEC I.Original BEC in 1971 (SITC, Rev.1) II.First revision 1976 (SITC, Rev.2) III.Second revision 1984 (SITC, Rev.3) IV.Third revision 1986 (corrigendum) V.Fourth revision 2002 (SITC, Rev.4) Expert Group on Classifications

5 History of the BEC 1.At its thirteenth session, in 1965, the Statistical Commission: (a)recognizing the growing need for international trade statistics analyzed by broad economic categories, (b)recommended to distinguish (i)food, (ii)industrial supplies, (iii)capital equipment, (iv)consumer durables and (v)consumer non-durables, (c)recommended that each reporting country compiles those broad economic categories for the world and principal regions to supplement the data already compiled on the basis of the sections of the SITC. Expert Group on Classifications

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Friends of the Chair Group on Internationalization 8 (i)Re-defining BEC structure to better reflect current economic reality, (ii)Extending its scope, including services as well as goods, while giving extra attention to the definition of intermediate goods, (iii)Improving explanatory materials to help both compilers and users of data disseminated according to BEC, and (iv)Providing updated correspondence tables to link BEC with other statistical classifications. Mandate of TSG on BEC

9 Reasons for revising 1.BEC is still relevant: referred to in more than 300 research papers since End-use categories should be better visible 3.Better guidance on dual-use classification 4.Updating of Economic categories 5.Services should be added (BEC – CPC) 6.Review of correspondence HS - BEC Expert Group on Classifications

10 Dimensions of the 5 th revision 1.Broad Economic Categories 2.Goods and Services 3.End-use categories 4.Primary and Processed (intermediate consumption) 5.Generic and Specified (intermediate consumption) 6.Durable and non-durable (final consumption) Expert Group on Classifications

11 Expert Group on Classifications BEC – Broad Economic CategoriesTotalServicesGoods 1. Food, beverages, agriculture, catering Energy, Mining, basic metals, chemicals, plastics Construction, housing, appliances, furniture, decoration and accommodation Textile, apparel, footwear, fashion, jewelry Transport equipment and services, and travel ICT, business and finance services, news, media, electronic entertainment Health, sports, cultural activities, education, science, research, testing Other

12 Structure of 5 th revision of BEC Expert Group on Classifications CodeMain economic categories Goods or Services End-Use category Primary versus processed Generic versus Specif. Non- Durable/ Durable Food and beveragesGoodsIntermediate consumptionPrimaryN/ANon-durable Food and beveragesGoodsIntermediate consumptionPrimaryN/ADurable Food and beveragesGoodsIntermediate consumptionProcessedGenericNon-durable Food and beveragesGoodsIntermediate consumptionProcessedCustomizedNon-durable Food and beveragesGoodsIntermediate consumptionProcessedGenericDurable Food and beveragesGoodsIntermediate consumptionProcessedCustomizedDurable Food and beveragesGoodsCapital formationProcessedGenericDurable Food and beveragesGoodsCapital formationProcessedCustomizedDurable Food and beveragesGoodsFinal consumptionPrimaryN/ANon-durable Food and beveragesGoodsFinal consumptionPrimaryN/ADurable Food and beveragesGoodsFinal consumptionProcessedGenericNon-durable Food and beveragesGoodsFinal consumptionProcessedCustomizedNon-durable Food and beveragesGoodsFinal consumptionProcessedGenericDurable Food and beveragesGoodsFinal consumptionProcessedCustomizedDurable Food and beveragesServicesIntermediate consumptionN/AGenericN/A Food and beveragesServicesIntermediate consumptionN/ACustomizedN/A

13 Structure of 5 th revision of BEC Expert Group on Classifications Code Goods or Services End-Use category Primary versus processed Generic versus Specif. Non- Durable/ Durable GoodsIntermediate consumptionPrimaryN/ANon-durable GoodsIntermediate consumptionPrimaryN/ADurable GoodsIntermediate consumptionProcessedGenericNon-durable GoodsIntermediate consumptionProcessedCustomizedNon-durable GoodsIntermediate consumptionProcessedGenericDurable GoodsIntermediate consumptionProcessedCustomizedDurable GoodsCapital formationProcessedGenericDurable GoodsCapital formationProcessedCustomizedDurable GoodsFinal consumptionPrimaryN/ANon-durable GoodsFinal consumptionPrimaryN/ADurable GoodsFinal consumptionProcessedGenericNon-durable GoodsFinal consumptionProcessedCustomizedNon-durable GoodsFinal consumptionProcessedGenericDurable GoodsFinal consumptionProcessedCustomizedDurable ServicesIntermediate consumptionN/AGenericN/A ServicesIntermediate consumptionN/ACustomizedN/A

14 Global Consultation of draft BEC 1.July - September sent – 49 responses received 3.Overall positive 4.More clarification needed 5.Some specific comments for amendments Expert Group on Classifications

15 Results of Global Consultation  Use different approach for choosing the top-level economic categories. Give exact definition of the categories in terms of HS and CPC.  What is the additional value of BEC over a breakdown of HS codes by ISIC classes and end-use (as input to the SUT)?  Clarify that the end-use dimension is fully independent from the economic categories in the revised BEC.  Explain how services data could be allocated, if services are collected with EBOPS and not with CPC classes.  Should the end-use category ‘gross fixed capital formation’ actually be ‘gross capital formation’?  The 4 th and 5 th dimensions should be properly defined Expert Group on Classifications

16 Next Steps Expert Group on Classifications Update the draft manual and circulate for comments to the TSG by end of May Receive comments of the TSG members by end of June Produce next version of the manual and circulate to TSG by end of August Receive final comments of TSG by mid-September Submit final draft to EG of international statistical classifications for approval by end-September

17 Points for Discussion Expert Group on Classifications Do you have comments on the outcome of the global consultation? 2.Do you agree with the proposed next steps ? 3.Should the BEC, rev.5 be brought to the Statistical Commission for endorsement?

18 Thank you