2. Presented by Yamuna Rajapakse, Statistician Udaya Warnasiri, Statistical Officer National Accounts Division,Sri Lanka International Workshop On Measuring GDP by Final Demand Approach 25-27 April 2011 Shenzhen, China Country Presentation

3. Outline  Introduction  Historical background of compilation of Final Consumption of households (Private Consumption Expenditure) PCE  UN-SNA1993 suggestions and formats on PCE  Data sources for compilation of PCE  Presentation Formats/Framework for PCE in our practices  Compilation methodology of PCE  Issues 1

4. Introduction  The Gross Domestic Product (GDP) per capita at current prices was US $ 2,399 for the year 2010 in Sri Lanka.  Compilation of Gross Domestic Product (GDP) Estimates are being compiled by using three approaches of compilation of GDP. The Product approach is supply side estimate of GDP and the expenditure approach is demand side compilation approach of Gross Domestic Product /Expenditure (GDE).  GDE consists of Main five sub components 1) Private Final Consumption Expenditure (PCE) including Non Profit Institutions Serving Households (NPISH) 2) Government Final Consumption Expenditure 3) Gross Capital Formation (GCF) 4) Exports 5) Imports 2

5.  Historical background of compilation of PCE  Compilation of National Accounts Estimates (NAE)for Sri Lanka was introduced in1947 by Dr. B. B. Das Gupta. This was published as an appendix to the report of the Commission on Social Services in 1947 and this includes NAE series 1937- 1938 and 1943– 1944. (Vide Sessional paper No. Xii, 1947). This was continued on a regular basis and released through a publication on National Accounts of Sri Lanka by K. Williams then the director of Department of Census and Statistics (DCS). DCS has adopted this framework for the compilation of NAE until late 1950,s. This includes only few tables such as Gross Domestic Expenditure (GDE), Imports, Exports, Domestic consumption etc. 3

6.  Historical background of Compilation of PCE  GDE estimates was compiled and released by using expenditure approach at current market prices for Sri Lanka. Until 1958 these estimates were compiled only at purchaser prices. During this period, price changes were at insignificant level or less than 5%.  First constant price GDE estimate series was started from 1963 as the base year. This publication includes only six tables. 4

7.  UN-SNA1993 Suggestions and formats on PCE  Scope of PCE is “Use of Goods and Services for direct satisfaction of human needs and wants” Values at Purchasers prices or current market prices and all estimates at accrual basis.  This includes expenditure of residents abroad and excludes expenditure of non-residents in the country.  Suggested Classifications are CPC- Central Product Classification and COICOP- Classification of Individual Consumption by Purpose 5

8. UN-SNA1993 Suggestions and formats on PCE Production of Household Services Eg. However, production of services for own final use is excluded, a. Cleaning and small scale maintenance by own tenants and owners b. Cleaning & Services for household durables vehicles by owners. c. Preparation of meals, caring and instructions for children d. Caring of sick & old people etc. e. Transportation of household members. 6

9.  Data sources for compilation of PCE- Sri Lanka  Product approach Estimates and their Expenditure Estimates or Users of Production-DCS  Household Income and Expenditure Surveys (HIES)- once in every five years-DCS  Foreign trade data /Imports and Exports- Customs Department  Socio demographic data/ Mid year population/External migration (less than one year)/ Tourist arrivals, Government Budget estimates- Actual  Government transfers -Balance of Payment (BOP)-CBSL  Price Statistics-DCS 7

10.  Presentation Formats/Framework for PCE in our practices  The following selected tables are the relevant tables on PCE and those are presented below.  Summary indicators of GDP  Gross Domestic Expenditure at Current Market Prices and Constant prices (Two Tables)  Private Final Consumption Expenditure at Current Market Prices and Private Final Consumption Expenditure by ICP sub Headings.  Supply and Use/Disposition (Agriculture) 8

11.  Presentation Formats/Framework for PCE- our practices  PCE is given in this table as a total under PCE which was compiled by using expenditure approach for GDP at current and constant (2002) prices. 9

12.  Presentation Formats/Framework for PCE in our practices 10

13.  Presentation Formats/Framework for PCE in our practices 11

14.  Presentation Formats/Framework for PCE in our practices 12

15.  Compilation methodology of PCE  PCE by objects is a table prepared indicating summarized sub categories of PCE. This is compiled by using the production estimates which is having separate estimates to indicate users or distribution of production, exports and imports. This is being compiled in detailed for ICP sub categories (155 sub headings) of PCE using the similar kind of procedure. 13

16.  Compilation methodology of PCE  The supply and disposition Table includes the supply of group of products which was complied by using commodity approach and their users or demand side information was also given. So the demand side information includes the Private consumption expenditure.  This was compiled using the production estimates of products or group of products and the relevant data sources were given earlier. 14

17.  Issues  Identifying these sectors, data collection framework should be strengthen/developed to cover these underground, illegal, informal sectors & household production for own use. Activities of Non observed economy are; 1. Under ground and 2. Illegal 3. Informal and 4. For undertaken by households for their own final use. These are problem areas where data gaps can be seen. 15