Australia’s practice of management, analysis and utilization of trade in services statistics. Nic Brown Assistant Secretary Trade and Economic Analysis Branch Australian Department of Foreign Affairs and Trade November 2007

Australia’s trade in services – an overview

Ratio of services trade to total trade Selected countries – 2006 (a) Source: IMF IFS Statistics & OECD (a) 2005 data for India, Indonesia and OECD

Australia’s services trade ratio to GDP Includes services for the Sydney Olympic Games Source: Australian Bureau of Statistics

Impact of the 2000 Sydney Olympic Games

Treatment of the Games Game effectTreatment in BoP Olympic tickets used by overseas visitors to non-residentsTravel credits Other expenditure in Australia of Olympic athletes and other overseas visitorsTravel credits Delivery of TV broadcasts to right holdersAudio visual credits SOCOG payments to IOCRoyalties and licence fee debits Receipt by SOCOG of sponsorship payments from non-residentsRoyalties and licence fee credits Airfares earned by resident carriers from overseas visitors coming to the GamesPassenger services credits Other services acquired by SOCOG from non- residentsRelevant services group SOCOG - Sydney Olympic Games Organising CommitteeCredits - exports IOC - International Olympic CommitteeDebits - imports

Exports Imports Australia’s services trade 2006 Source: Australian Bureau of Statistics

Australia’s exports of services by major market Source: Australian Bureau of Statistics

Australia’s imports of services by major source Source: Australian Bureau of Statistics

Statistical framework for Australian trade in services statistics

History of collecting Australian services statistics Compiled by the Australian Bureau of Statistics (ABS) Integral part of BOP and National Accounts Statistics Collected from banking statistics up to the 1970s –Only broad aggregates produced From 1980s sourced from business surveys and other ‘administrative’ data –Range of data collected expanded to meet users needs

Conceptual framework IMF Balance of Payments Manual version 5 (BPM5) Resident/non-resident transactions –Does not cover foreign affiliates trade (Mode 3) Services valued at market price Services include some transactions in goods, –Travel expenditure by visitors and students and government personnel (including defence) –Packaged software included in goods

Trade in services statistics - Beyond the BOP framework The United Nations has published the Manual on Statistics of International Trade in Services, 2002 Four GATS modes of supply

Modes of supply Four modes of supply –Mode 1 Cross border supply –Mode 2 Consumption abroad –Mode 3 Commercial presence –Mode 4 Movement of natural persons Data by country, by mode of supply by detail services activity

Data sources ABS Survey of International Trade in Services (SITS) –Stratified sample survey –Conducted quarterly –Maintaining coverage is an issue

Data sources continued Administrative data –Merchandise trade data –Overseas arrivals and departures data –Student visa data –Survey of International Students –International and National Visitors Survey –Australia Prudential Regulatory Authority (APRA) financial and insurance data

ABS Extended BOP classification Extended services classification –11 major groups –60+ detailed services commodities Because of confidentiality, the level of detail for most countries will only be up to the 11 major groups

CollectedPublished Australia By partner Country (a) Transportation931 Travel333 Communications621 Construction111 Insurance551 Financial111 Computer & information551 Royalties & licence fees661 Other business20 1 Personal, cultural & recreation12111 Government111 Total (a) some additional services activity data is available for significant trade partners

User needs for Australian trade in services statistics

Unmet user demand Trade in services data to support trade negotiations (modes of supply) –Monitor finalised trade agreements –WTO dispute settlement procedures, ESM and rule on services disciplines Services industries bodies –To promote services trade –Identify barriers to services trade

ABS ITSUG International Trade in Services User Group –Government and industry representation Forum to discuss trade in services statistics –User needs –Methodology and data sources –Expertise in particular service fields

Future directions and challenges Impact of changing technology and ways of doing business Revise methodology and data sources for government, financial and insurance services Update to BPM6 in September 2009 Addressing the impact of confidentiality Collect trade in services statistics by the four GATS modes of supply