PERU: THE MONTHLY INDEX OF NATIONAL PRODUCTION INEI - INSTITUTO NACIONAL DE ESTADISTICA E INFORMATICA
MONTHLY INDEX OF NATIONAL PRODUCTION OBJECTIVE: - Measure the trend of GDP in the short term - To assess the effects of economic politics The Monthly Estimate of GDP, responds to the necessity to have economic indicators of short term, that facilitate the process of analysis and the decision making, as well as, of the measurement and evaluation of the effects of the economic policy in the conjuncture. INEI - INSTITUTO NACIONAL DE ESTADISTICA E INFORMATICA
GDP: THE METHOD OF PRODUCTION • The total value of goods and services supplied by the economic system can be measured, in three alternative ways: in terms of – unduplicated production, – incomes generated or – final expenditure. • The production approach production approach measures the contribution of each sector to total GDP. Aggregate value added by all sectors is GDP of the country. INEI - INSTITUTO NACIONAL DE ESTADISTICA E INFORMATICA
Framework National Accounts • The annual estimates of GDP by sector are derived in the framework of the national accounts, while the monthly estimates are based on proxy indicators such as production, inputs, sales. • The annual values of GDP serve as benchmarks for the monthly estimates. INEI - INSTITUTO NACIONAL DE ESTADISTICA E INFORMATICA
FEATURES OF MONTHLY PRODUCTION INDEX AND THE NATIONAL ACCOUNTS GDP QUARTERLY GDP AND MONTHLY FEATURES ANNUAL NATIONAL PRODUCTION INDEX ACCOUNTS 1. Structure and Classification SNA 1993 Rev. 3 UU.NN. SCN 1993 Rev. 3 NN.UU. 2. Calculation Method Production Method Production, Expenditure, Income 3. Base Period Base Year 1994 = 100 Base Year 1994 = 100 4. Constant Prices Average Price 1994 Average Price 1994 5. Periodicity Monthly Quarterly and Annual 6. Coverage Information Sample Statistical Universe 7. Results Presentation 45 days Quarterly: 60 days Annual: 180 days INEI - INSTITUTO NACIONAL DE ESTADISTICA E INFORMATICA
FLOW OF DATA SOURCE OF MONTHLY INDEX OF NATIONAL PRODUCTION PRODUCCIÓN NACIONAL POR SECTORES ECONÓMICOS: JULIO 2010 (Variación porcentual, respecto a similar mes del año anterior) Sector Statistical Office 17,24 12,33 12,08 SECTOR SURVEYS 10,65 9,05 9,11 8,86 8,82 8,71 6,65 ADMINISTRATIVE RECORDS 3,58 2,42 0,64 DIRECT -14,57 MEASUREMENT Global Construcción Financiero Comercio Pesca Manufactura Electricidad Restaurantes Servicios Resto de Transporte Agropecuario Servicios Minería y Y y Prestados Otros y Gubernamentales e Seguros Agua Hoteles a Empresas Servicios Comunicaciones Hidrocarburos Fuente: INEI. 68,28% ESPECIALS SURVEYS REPORT MONTHLY INDEX National Statistical Office TECHNICAL OF PRODUCTION MONTHLY 45 days INDIRECT MEASUREMENT 31,72% National Statistical Office INEI - INSTITUTO NACIONAL DE ESTADISTICA E INFORMATICA
STRUCTURE PERCENTAGE OF GDP IN 1994 BASE YEAR ECONOMIC SECTOR WEIGHTING (%) MEASUREMENT GROSS DOMESTIC PRODUCT 100,00 Direct Indirect Estimation Methods in the monthly calculation DI-Other Taxes on products 9,74 Import Duties 1,74 1,74 Other Taxes on Products 8,00 8,00 Agricultural 7,60 7,60 Fishing 0,72 0,72 Mining and Hydrocarbons 4,67 4,67 Manufacturing industries 15,98 15,98 Electricity and Water 1,90 1,90 Construction 5,58 Concrete Works 5,22 5,22 DIRECT Concrete Works does not 0,10 0,10 MEASUREMENT Physical Progress of Works 0,26 0,26 : 68,28% Trade 14,57 Companies with 10 or more workers 8,81 Companies less than 10 employees 5,76 Transport and Communications 7,52 Rail, air, water and communications 2,54 Road 4,98 Government Services 6,33 6,33 INDIRECT MEASUREMENT : Financial and Insurance 1,84 1,84 31,72% Restaurants and Hotels 4,17 4,17 Services Offered to Companies 7,10 Companies with 10 or more workers 3,73 Companies less than 10 employees 3,37 Other Services* 12,29 12,29 (*)Other Services include rental of Housing and Personal Services. INEI - INSTITUTO NACIONAL DE ESTADISTICA E INFORMATICA
APPROACHING TO GDP • Generally, there are three approaches to estimating monthly GDP at constant prices: (1) valuing quantity data by applying base year unit values Agriculture, Fishing, Mining (2) price deflation Services (Trade, Restaurants, personal services..) (3) Extrapolation of volume index Electricity, Hotels, Construction, Manufacturing, Transport • In the construction of constant price GDP by industry these methods are applied. • The choice of which technique to use usually depends on data availability and suitability. • For most industries data availability determines which method to use. INEI - INSTITUTO NACIONAL DE ESTADISTICA E INFORMATICA
DATA SOURCES • Agriculture and forestry : The estimation include farming and livestock. • Fishing : estimation include sea fishing, freshwater fish and other sea products and culture fishing subsectors • Mining: The estimation include Extraction of metallic minerals and hydrocarbon • Manufacturing: Volume index of industrial output • Construction: Index of construction materials, Physical advance of roads • Trade: Volume indices of sale of motor vehicles, wholesale trade and retail trade. • Transport: Hauled freight in gross tonne-kilometres in rail goods transport, passenger-kilometres, production of post and telecommunications. • Hotels and Restaurants: monthly surveys about sales • Financial intermediation: estimated regarding Financial statements of bank companies, municipal and rural, financial companies • Services given to companies : surveys to Real-estate companies, rent of machinery, activities of computer science, radio and television • Services and public services : surveys and administrative records. INEI - INSTITUTO NACIONAL DE ESTADISTICA E INFORMATICA
ESTIMATING THE INDEX OF GDP The Gross Value of Production GVP in each sector is obtained by the sum of the gross value of each product at constant prices. The algebraic expression of this method of building a constant price series is: ∑ * GVP p q = 0 , 0 , n i i n where q is the quantity and p is the price, n stands for the current and 0 for the base period, And i are the commodities. The summation covers the entire range of commodities produced by a particular sector. The real GVP of each sector is transformed into a index, comparing the monthly GVP Analyzed with respect to average GVP of the base year 1994 INEI - INSTITUTO NACIONAL DE ESTADISTICA E INFORMATICA
ESTIMATING THE INDEX OF GDP The real GVP of each sector is transformed into a Index comparing the monthly GVP analyzed with respect to average GVP of the base year 1994. GVP , * 100 p n IGVP = n GVP , p o IGVP n = Index of real gross value in the month n GVPpn = real gross production value in month n GVPpo = Gross Value of Production monthly average in the base year The Monthly Index of the National Production, is obtained by means of the aggregation weighted of the indexes of each sector that are included in the conjuncture investigation INEI - INSTITUTO NACIONAL DE ESTADISTICA E INFORMATICA
ESTIMATED MONTHLY INDEX OF NATIONAL PRODUCTION The Monthly Index of National Production, is obtained by adding weighted indices for each sector, using as weighting factors, the annual percentages the base year. Vs ∑ IGVP 0 * 100 IGVPs ∑ = t/o t Vs 0 Simple index Weighing sector base year Vs 0 = Sector value in the base year ∑ Vs 0 = Sum of base year Sector INEI - INSTITUTO NACIONAL DE ESTADISTICA E INFORMATICA
VALUATION AND ADJUSTMENT TO THE NATIONAL ANNUAL ACCOUNTS • The evolution of the sectorial production measured across the Gross Value of monthly Production (Po Qn) has several phases: • First it passes to terms of Added Value using the technical coefficients of the TIP (VAB / VBP) of the year base. • Second, the added monthly sectorial value is adjusted to the Value Added Anual of the National Accounts with the method of the Benchmarking, for what adding the monthly values there is obtained a value similar to that of the National Accounts, in every sector and the total. Hereby one handles the unique annual information to institutional level. INEI - INSTITUTO NACIONAL DE ESTADISTICA E INFORMATICA
Timing of the release • GDP by sector is released to the public on a monthly basis 45 days after the end of the reference period. The release dates are announced in advance for each year. Monthly revisions • When estimates of GDP by sector are prepared for a current month, each three months they are revised. The main sources for the regular monthly revisions are the source of the data. INEI - INSTITUTO NACIONAL DE ESTADISTICA E INFORMATICA
REBASING • In Peru, rebasing has traditionally been done at fiveteen year intervals implementing, 1979 and 1994 as base years.. • The most up-to-date measures of monthly GDP are expressed in term of 1994 New Soles. SEASONAL ADJUSTMENTS • Seasonal adjustments of the monthly GDP data are performed at the most detailed level possible. At the moment, the monthly GDP by sector, use X-12-ARIMA for the seasonal adjustment of its time series INEI - INSTITUTO NACIONAL DE ESTADISTICA E INFORMATICA
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