STD/TBS/Trade and Competitiveness Section An “alternative presentation” of trade by product OECD Statistics Directorate Agenda Item : 5f Agenda 3rd WPTGS meeting 4-6 October 2010, OECD

STD/TBS/Trade and Competitiveness Section Outline A.No unified presentation of trade in goods/services B.Why a proposal for an alternative presentation of trade by product. C.The conceptual correspondence: a tentative example C1- Trade by product correspondence table C2-Correspondence on trade in goods side C21- Removing duplicates C22-Estimating distribution services C3-Correspondence on trade in services side C4- Merge both to present trade by product and industry. D. Conclusion/questions

STD/TBS/Trade and Competitiveness Section A. No unified presentation of trade in goods and services 1.Trade in goods described by HS 2007 and SITC rev 4 – physical movement of goods cross frontiers 2.Trade in services – BOP/EBOPS 2010 – resident non-resident transactions – goods is “general merchandise” – change of ownership. 3.The detail is in one (IMTS for goods) or the other (BOP for services) but not both

STD/TBS/Trade and Competitiveness Section B. Why a proposal for an “alternative presentation” of trade by product. The needs for relating trade statistics to SUT and IO is an argument for producing integrated statistics on trade in product by activity This could also improve analytical links to production, employment, enterprise, AMN, and direct investment statistics.

STD/TBS/Trade and Competitiveness Section A tentative correspondence at a modest level of disaggregation Only “current” classifications are used. Only at the section level of ISIC rev 3.1 and at the higher level of EBOPS data. Only exports are considered

STD/TBS/Trade and Competitiveness Section C. The conceptual correspondence: a tentative example Data from OECD ITCS and TIS databases (reference year 2007) loaded in access database. Service : Use (and develop) the correspondence table between ISIC rev 3.1 and EBOPS 2002 using CPC1.1 as a link(source MSITS 2002)  Goods : use the existing correspondence between HS 2002, CPC ver. 1.1, ISIC rev 3.1  Merge to obtain trade by product (CPC 1.1) and by industry (ISIC rev 3.1)

STD/TBS/Trade and Competitiveness Section Special focus on two “cross cutting” items: 1.Distribution services understand the role of these in trade, important in context of GATS - estimated using basic assumptions of BEA on US Trade 2.Software licences registered in Goods (to get a sense of size of these of interest to NA that qualify as GFCF) – proxied with HS disc for laser reading system. Manufacturing services on inputs owned by others not dealt with

STD/TBS/Trade and Competitiveness Section C1- The trade by product correspondence table 1/2

STD/TBS/Trade and Competitiveness Section The correspondence table 2/2

STD/TBS/Trade and Competitiveness Section C2-Correspondence on trade in goods side No one to one correspondence between ISIC and HS – CPC. One HS series can consequently be allocated to (or produced by) several industries, hence generating some double countings when producing a trade by industry table. Some “duplicate” HS series do then need to be removed.

STD/TBS/Trade and Competitiveness Section C21-Removing “duplicates” in OECD merchandise trade data 1/2 35 commodity duplicates (out of 80 at section level) are related to ISIC section B (fishing) i.e. same commodity linked to ISIC classes 0501 (Fishing) and 0502 (Aquaculture) HS item “Discs for laser reading systems” linked to section D (manufacture) & section K (real estate, renting & business activities) in class 7221 software publishing.

STD/TBS/Trade and Competitiveness Section C22-Removing duplicates in OECD merchandise trade data 2/2

STD/TBS/Trade and Competitiveness Section OECD Merchandise exports by ISIC section (2007)

STD/TBS/Trade and Competitiveness Section OECD merchandise exports by ISIC (2007)

STD/TBS/Trade and Competitiveness Section Estimating distribution services included in merchandise by ISIC (2007)

STD/TBS/Trade and Competitiveness Section C3-Correspondence on trade in services side No one to one correspondence with ISIC. EBOPS only partly product based Working at an aggregate level allows to calculate a total OECD

STD/TBS/Trade and Competitiveness Section OECD services exports by ISIC section (2007)

STD/TBS/Trade and Competitiveness Section OECD services exports by ISIC section (2007)

STD/TBS/Trade and Competitiveness Section C4- Merge both to present trade by product and industry

STD/TBS/Trade and Competitiveness Section OECD trade by ISIC sections (2007)

STD/TBS/Trade and Competitiveness Section Impact of allocating DVDs to industry K instead of industry D.

STD/TBS/Trade and Competitiveness Section OECD exports by main activity

STD/TBS/Trade and Competitiveness Section OECD trade by ISIC

STD/TBS/Trade and Competitiveness Section D- Conclusion & next steps “Alternative presentation” is still at a preliminary stage. Some of main challenges (manufacturing services) of future revision not dealt with here. As no one to one correspondence is possible many calculation of estimates necessary and metadata should be studied carefully, Next step: extend the example to imports Present the Industry section at the division level Benchmark with existing surveys to give more importance to Secondary production of services of industries primarily producing goods.

STD/TBS/Trade and Competitiveness Section Questions to the WPTGS Any experience in estimating distribution services included in merchandise trade? How should perpetual Licences to use software-non customized- provided on disk be treated. Is HS (Discs for laser reading systems) a good proxy ? How could manufacturing services be treated in future?