1. Implications of globalisation for economic statistics Trade measurement issues Art Ridgeway Balance of Payments Division July 2007

2. Balance of Payments Division Statistics Canada 2 Outline Trade – Ownership & Physical Flows Organization of Production Economic data for supply chains

3. Balance of Payments Division Statistics Canada 3 Goods Trade – The New World Goods for Processing – Cross border flow ≠ Ownership change Goods vs. services Valuation of flows Consistency with banking Merchanting –Ownership change without cross border flow Inventories are outside country of owner Banking flows with no imports or exports

4. Balance of Payments Division Statistics Canada 4 Goods for Processing Finished Goods Cash = value of service Service included in Finished Goods Goods for processing Company ACompany B Canada United States Finished Goods Cash = value of service Processing Service Goods for processing Company ACompany B Canada United States Current Treatment Forthcoming Convention

5. Balance of Payments Division Statistics Canada 5 Merchanting (International Wholesaler) Inventories CustomerSupplier Country A Country BCountry C

6. Balance of Payments Division Statistics Canada 6 Traditional View of Goods Production Manufacturing establishment Inventories MaterialsFinished Goods Head Office (Finance, Development, Marketing) (Ancillary) Component Supplier Final Market

7. Balance of Payments Division Statistics Canada 7 Outsourcing Production for Export market – Economic Flows Head Office (Finance, Development, Marketing) Inventories MaterialsFinished Goods ProcessorComponent Supplier Final Market

8. Balance of Payments Division Statistics Canada 8 Data Challenges Taking the four economies in turn look at data needs for each case –Customs data –Production surveys establishments - local units –Financial surveys enterprises –Trade in services

9. Balance of Payments Division Statistics Canada 9 Economy I Econ III Econ IV Econ IEcon II Head Office (Finance, Development, Marketing) Inventories MaterialsFinished Goods Processor Component Supplier Final Market

10. Balance of Payments Division Statistics Canada 10 Economy III Econ III Econ IV Econ IEcon II Head Office (Finance, Development, Marketing) Inventories MaterialsFinished Goods ProcessorComponent Supplier Final Market

11. Balance of Payments Division Statistics Canada 11 Economy II Econ III Econ IV Econ IEcon II Head Office (Finance, Development, Marketing) Inventories MaterialsFinished Goods Processor Component Supplier Final Market

12. Balance of Payments Division Statistics Canada 12 Economy IV Econ III Econ IV Econ IEcon II Head Office (Finance, Development, Marketing) Inventories MaterialsFinished Goods ProcessorComponent Supplier Final Market

13. Balance of Payments Division Statistics Canada 13 Data Source Research Customs data –Additional use of information on customs forms Production surveys –Questions on outsourcing or off shoring –Inventories within and outside the country Trade in Services –Better data on processing and merchanting

14. Balance of Payments Division Statistics Canada 14 Data Integration Improved coordination of estimates for –Goods trade –Services trade –Production Improved integration in building –National Accounts –Balance of Payments