D2,2.philippines country practices

MEASURING THE
GROSS REGIONAL EXPENDITURES
(GRDE)
IN THE PHILIPPINES
by
VIVIAN R. ILARINA
National Statistical Coordination Board
Philippines

International Workshop on Regional Products and Income
Accounts
Beijing China, 15-17 March 2010

International Workshop on Regional Products and Income Accounts, Beijing, China NATIONAL STATISTICAL COORDINATION BOARD
VRIlarina/ March 15-17 2010

Outline of the Presentation

I. Introduction
a. Brief History
b. Salient Features of the Present GRDE
c. Compilation Process

II. The Gross Regional Domestic
Expenditures
a. Scope and Coverage
b. Sources of Data
c. Estimation Methodology
d. Measurement Issues

III. Way Forward


I. Introduction

A. Brief History

The Philippine System of National Accounts
(PSNA)
• The has been continuously compiled for almost
63 years now which started in 1947 – for the
annual
national accounts and in 1983 for the quarterly
national
accounts;

• The National Statistical Coordination Board
(NSCB) which
is task with the compilation of the PSNA has
started
development of the GRDE in 1987 – much later
after
the start of the GRDP in 1971;

• 1987 is also a milestone in the PSNA as this
starts the
regular publication of the GRDE on an annual
basis;

• The first release of the GRDE was at base year
1972
and an overall revision / rebasing of the GRDE
was undertaken in 1990 with the shift of the
base year
to 1985 and improved estimates.


B. Salient Features of the Present GRDE

• The GRDE is intended to complement the current
series of the GRDP to be able to provide
measures
of the regional economy at the production and
expenditure sides of the national accounts;

• While the compilation of the GRDE started in 1987,
this is
still in its developmental stage since the NSCB is
constantly improving the GRDE by coordinating
with
various agencies for the improvement of data
support
for this set of accounts;


• The present GRDE is at base year 1985; still
follows
the recommendations of the 1968 UNSNA;

• The 2009 GRDE publication is covering the
period 2006,
2007 and 2008;

• The GRDE has a lag time of one year – that is,
data
becomes available in the publication after one
year;

• The GRDE release is first week August of each
current
year.


C. Compilation Process of GRDE
1. The GRDE starts from the national level
estimates.

GDP at the expenditure side is compiled
as :
1. Personal Consumption Expenditures (PCE)
Plus 2. Government Consumption Expenditures (GCE)
Plus 3. Gross Domestic Capital Formation (GDCF)
a. Fixed Capital
a.1. Construction
a.2. Durable Equipment
a.3. Breeding Stocks
b. Changes in Stocks
Plus 4. Exports
a. Merchandize Exports
b. Non-Merchandize Exports
Plus 5. Imports
a. Merchandize Imports
International Workshop on Regional Products Non-Merchandize Imports
b. and Income Accounts, Beijing, China NATIONAL STATISTICAL COORDINATION BOARD

For the Gross Regional Domestic Expenditures,
the
following are estimated separately by region
namely:

1. Personal Consumption Expenditures (PCE)
2. Government Consumption Expenditures
(GCE)
3. Construction
4. Durable Equipment
5. Breeding Stocks, Orchard Development &
Afforestation


The rest of the expenditure items below are
estimated
as residual : 1. Exports
2. Imports and
3. Changes in Stocks

The residual estimates also includes the statistical
discrepancy between the production and the
expenditure
sides of GDP.

The GRDE starts with the national estimates as
control total
and these are allocated among regions using
appropriate
regional indicators.


II. The Gross Regional Domestic Expenditures
(GRDE)

THE COMPILATION OF THE GRDE

a. Scope and Coverage
(operational)

b. Major sources of data


d. Some Measurement Issues


1.Personal Consumption Expenditures

a.Scope and Coverage:
- includes the final consumption
expenditures of
individual households, institutional
households,
and private non-profits institutions
serving
households.

b. Source of data: Family Income and
Expenditure Survey (FIES) by region
which is
conducted by the National Statistics
NATIONAL STATISTICAL COORDINATION BOARD
Office
International Workshop on Regional Products and Income Accounts, Beijing, China

PCE is classified by item of expenditures
namely:

1. food
2. beverage
3. tobacco
4. clothing and footwear
5. fuel, light and water
6. household furnishings
7. household operations
8. transportation and communications
9. miscellaneous expenditures like
medical and
health expenses, personal care, etc.


c. Estimation Methodology:

Benchmark : Regional distribution of total
expenditures from Family Income and
Expenditure Surveys (FIES) – serves as
indicator to allocate national level
estimates.

Annual: trend extrapolation of regional
estimates resulting from modified
commodity flow method
by region using indicators used on
production
coming from the GRDP.

Deflator: Consumer Price Index by region
(average of all items for each
region)

d. Measurement Issues:

The estimation of PCE at the regional level
pose limitations for the replication of the
methodology used at the national level
because of the unavailable data for regional
estimates.

It is assumed that the distribution of the
final
expenditures of NPISH is the same as the

2. General Government Consumption
Expenditures

a. Scope and Coverage:
includes central (or national) government;
local government and social security
agencies

b.Sources of data:
a. For national and local govt - financial
report from the Commission on Audit (COA)
b. For social security agencies – financial
report from the Social Security System (SSS)
and the Government Service Insurance System
(GSIS)


d.Estimation Methodology:

Regional for government consumption
expenditures are coming from the
Commission on Audit (COA).

When data are not available from COA, data
on regional program of expenditures from
the Department of Budget and Management
(DBM) are used.

Deflator: Average Earnings Index –
computed at national level is the same
index used for all regions. CPI by region for
maintenance and operating expenses. BOARD
NATIONAL STATISTICAL COORDINATION

3. Construction


Classified into public construction and private
construction;

- Public construction - are construction done by
national
government, local government, and government
corporations;

- Private construction - are residential construction
and
non-residential construction


b. Sources of data:

1. For public construction – annual financial
reports from Commission on Audit; the
Budget of Expenditures and Sources of
Financing (BESF) of the Department of Budget
and
Management (DBM)

2. For private construction – report on building
permits compiled by the National Statistics
Office (NSO)



1. Regional public construction - Estimated only
for physical accomplishment of contruction
put in place;

2. Regional private construction – Estimates for
residential and non-residential; used the
S-curve to estimate percentage distribution
of physical accomplishments for the period.

Deflator:
Regional CPI for housing and maintenance
provides the regional differentials applied to the
composite price index at the national level.


d. Measurement Issues:

1. Regional allocation of the sector’s
output among regions is based on indicator
of regional distribution as estimated from
the
gross valued added of public and private
construction;

2. Undercoverage for private construction
which is based from building permits
is assumed to be uniform across regions
because there is no data currently available
to estimate the undercoverage ratio by
region.

3. For public, the national deflator used is used
for all
regions.

4. Durable Equipment


-consists of outlays for new and used capital
goods such as machinery and equipment
acquired by all resident producers less sales
or transfers of used capital goods;

- covers machinery specialized for particular
industries,
general industrial machinery and equipment,
transport
equipment and miscellaneous equipment.


b. Sources of data:

For imports of durable equipment – foreign
trade statistics compiled by the National
Statistics Office (NSO);

For domestic production – census and
survey of establishments conducted by the
National Statistics Office (NSO).



1. Regional indicators are obtained from the
regional
pattern of expenditure on equipment are
resorted
which are generated from the establishment
census
and surveys.

Deflator – the same deflator is used for
national estimates and regional estimates
which is the Wholesale Price Index.

2. This assumes that for most capital goods price
determination is more a function of the
uniqueness
of the equipment rather STATISTICAL COORDINATION BOARD
NATIONAL
than its geographical

d. Measurement Issue:

The commodity Flow Method as applied at the
national level estimate can not be used at the
regional estimates since available data for
the
region can not fully support the methodology.


5. Breeding Stocks, Orchard Development and
Afforestation

- Breeding Stocks: refer to outlays on livestock and
poultry raised as breeders, draught, milking,
layers;

- Orchard Development: refers to outlays on the
cultivation of plantations until they become
productive;

- Afforestation : cultivation of forest trees in newly
created forest areas.


b. Sources of data :

1. Bureau of Agricultural Statistics – for
data
on inventory of livestock and
poultry;
cost of production studies on total
cost
per hectare for the
development/main-
tenance of plantations;

2. National Statistics Office – from the
Census
of Agriculture, data used are ratios of


Breeding Stocks
1. Estimates makes use of indicators on
regional
data on inventory and regional prices used
for breeding stocks, milking, laying and
work animals.

2. The regional ratios to determine the
number of animals used for capital
formation are based on the Census of
Agriculture.

Deflator - Regional farm gate prices for
each type of animals

Estimation Methodology:

Orchard Development
a. Estimates makes use of indicators on
regional
data on the distribution of value of
production
of major plantation crops.

Measurement Issues:

a. Regional distribution follows the gross
value
added by region.

Estimation Methodology

Afforestation
a. Estimates makes use of indicators on
regional
data on expenditures incurred by
private
enterprises and government as
reported by
the Forest Management Bureau (FMB)

Deflator
Regional cost per hectare reforested
translated into an index.

6. Changes in Stocks

- Stocks includes:
(a) Materials & Supplies
(b) Work-in-progress
(c) Finished Goods

(d) Goods for Resale



Changes in Stocks

Agriculture Non-Agriculture Government

• Rice • Crude • National
• Corn • Petroleum Products • Local
• Sugar • Trade • Gov’t Corporations
• Manufacturing /
Other Establishments


b. Sources of data :
a. Bureau of Agricultural Statistics (BAS) - data on quarterly volume
of production and inventory of rice and corn at the beginning of each
month, wholesale prices of rice and corn

b. Sugar Regulatory Board (SRA)- data on quarterly production,
imports, exports, consumption and prices of sugar
c. Foreign Trade Statistics (FTS), NSO- Exports and Imports of Rice
and Corn
d. Department of Energy (DOE)- monthly inventory and prices of
crude and petroleum products
e. Commission on Audit (COA)- annual data on inventories of
national, local government and government corporations


1. Regional estimates are done separately for the agriculture
and non-agriculture sectors.

2. Agriculture estimates used as regional indicators the stocks
held by households, commercial and National Food Authority

3. Non-agriculture estimates used as regional indicators
the inventory held by industrial and non-industrial sectos
particularly the finished goods held by manufacturing,
mining and quarrying establishments.


Deflator
Agricultural inventory – by farm gate prices

Non-agricultural inventory – by implicit price index
at the national level and distributed into regions using
as indicator the CPI.

d. Measurement Issue:
a. As in the case of durable equipment, estimates of changes
in stocks for non-agricultural industries use the establisment
based data and household stocks are not adequately
captured.


7. Exports and Imports
In the absence of regional trade flow, net
exports is derived
as a residual item.

Hence, net exports refers to the combined effect of
the
income flows between regions, the commodity
flows between
regions and the rest of the world and the
statistical discrepancy.


III. Way Forward

With the on-going Revision and Rebasing of the
National
Accounts, the present GRDE is also undertaking the
same
activities to consider the following for the release of
the
new GRDE series from 1998 to 2009:

1. Base Year 2000
2. New Classification Systems –
- Philippine COICOP
- Philippine PSCC
3. Adoption of the 1993 SNA concepts
4. Use of update data and parameters


Thank you very
much !

URL: http://www.nscb.gov.ph
e-mail: info@nscb.gov.ph


D2,2.philippines country practices

Recommended

Recommended

More Related Content

Similar to D2,2.philippines country practices

Similar to D2,2.philippines country practices (20)

More from Fundação de Economia e Estatística

More from Fundação de Economia e Estatística (20)

Recently uploaded

Recently uploaded (20)

D2,2.philippines country practices