1. Nadim Ahmad, Head of Trade and Competitiveness Statistics Division
Trade in value added and beyond: developing integrated international economic accounts
New Techniques and Technologies for Statistics: Satellite event on challenges in measuring productivity, growth and intangibles
Brussels: 17 March, 2017
Nadim Ahmad, Head of Trade and Competitiveness Statistics Division

2. What is TiVA and why is it useful?
A response to the ‘distortion’ caused by international fragmentation of production
..that decomposes trade flows by the sources of value-added they embody

3. …blurring policy making
Export driven growth strategies may target the wrong sectors
Competitiveness:
Bilateral trade positions: Protectionist policies can hurt domestic upstream industries and competitiveness
Systemic risks - impact of macro-economic shocks on supply-chains
(lack of) integration of emerging economies in GVCs

4. Providing new insights into GVCs..

5. And trade relationships
US trade deficit with selected partners, 2011: USD billion

6. ..and implications for policy making
Mexico’s exports by origin of value-added, 2011: the feedback loop

7. % of total intermediate trade
But not all regions are equal: The scale of integration varies significantly, espcially within regions (hubs)
Extra-regional and intra-regional trade in intermediates, selected regions, 2014
% of total intermediate trade
Regional and mega-regional agreements, 2016

8. And integration generates spillovers
Increase in foreign content of exports
Improvement in EC Ranking,

9. But TiVA only scratches the surface
Investment
Trade
Production
Jobs
Actors - SMEs
Inequalities

10. Distributional aspects

11. Widening income inequality Growth in real disposable income
Source: Unweighted average over 17 countries ; OECD Income Distribution Database

12. Especially important given the growing importance of MNEs
Contribution of foreign affiliates to domestic value added in exports, 2009.
Particularly because trade between affiliates is not always recorded consistently - services and income flows are becoming increasingly blurred.

13. Global production requires
that we put ‘global’ at the heart of national
But with a granularity that provides insights on the actors and their heterogeneity
Improving our understanding of interconnectedness and benefits, challenges and consequences of globalisation
Whilst also improving GDP

14. Extended Supply-Use Tables
An Interconnected (Fragmented) World requires an Interconnected (Integrated) approach
Extended Supply-Use Tables
An approach to bring together ‘disparate’ statistics under a common coherent umbrella
A mechanism to respond to policy demands related to globalisation
Without increasing response burdens
By capitalising on existing data sources
FATS, SBS, TEC
To develop indicators that can respond to the globalisation agenda, and at the same time improve the quality of current TiVA estimates.

15. Domestically owned MNE
Extended?
Foreign Owned
Domestically owned MNE
Domestic Owned
With high Export orientation
‘Exporters’
With low Export orientation
‘Non-Exporters’
Low import orientation
High import orientation S M L

16. Providing new insights on inclusiveness
SME share of total domestic value added of exports of transport eqpt, 2009

17. And the role of MNEs….
Shares of firms in gross exports and in exported value added, 2013

18. …and SMEs… … particularly dependent SMEs…
Shares of firms in gross exports and in exported value added, 2013

19. …around 30% of jobs depend on foreign markets…
Employment embodied in exports, by firm type, as share of total employment

20. …and up to 20% even in firms with no direct exports….
Share of employment that is embodied in exports, by firm type, 2013

21. ESUTs
Provide scope for improved integrated economic accounts - that respond to the global production-trade-investment agenda.
But they also provide basis for improved:
productivity analysis (world KLEMS)
improved quality in GDP and Trade stats (especially services)
better understanding of GDP/GNI wedges
IPP intra-firm transactions

22. Extensions to the extensions
Work is on-going to develop national ‘investment flow’ matrices that can be integrated with ICIO to provide deeper insights into the contribution of capital exporting countries within GVCs and capital stock estimates for MFP by industry.

23. What are we doing?
EGExSUTs – around 15 countries exploring feasibility
Expanding the ICIO – mainstreaming the initiative in collaboration with regional partners – FIGARO, APEC, ESCWA, ECLAC, ECA – and mainstreaming the development of ESUTS at the national level.

24. Thankyou