5489.0 - International Merchandise Trade, Australia: Concepts, Sources and Methods, 2015

ARCHIVED ISSUE Released at 11:30 AM (CANBERRA TIME) 11/11/2015

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BALANCE OF PAYMENTS STATISTICS

12.4 The balance of payments is a statement that summarises the economic transactions between residents and non-residents of the compiling economy during a specific time period. It consists of the current account, which includes the goods and services components, the primary income account, the secondary income account, the capital account and the financial account.

12.5 The goods component of the current account in Australia's balance of payments is largely compiled from international merchandise trade data. To compile goods data on a balance of payments basis adjustments are applied to international merchandise trade statistics to ensure that the transactions are correctly recorded in terms of coverage, timing and valuation.

12.6 Coverage adjustments are made to include transactions which are not part of the international merchandise trade statistics and remove transactions recorded in international merchandise trade which are not between residents and non-residents. Timing adjustments are made to ensure transactions are recorded in the period in which ownership changed, rather than in the period in which the transaction was recorded in international merchandise trade statistics. Valuation adjustments are made when the value recorded on the international merchandise trade transaction is found to be incorrectly estimated or reported.

12.7 Table 12.1 below lists and explains the differences between Australia's international merchandise trade statistics and the goods component of the balance of payments, as well as the type of adjustment and treatment in Australia's balance of payments. These differences can be categorised as:

differences between the standards (IMTS 2010 and BPM6)
differences due to Australia's practical application of the international standards.

TABLE 12.1: DIFFERENCES BETWEEN AUSTRALIA'S INTERNATIONAL MERCHANDISE TRADE AND BALANCE OF PAYMENTS STATISTICS


Description of goods or difference	Difference between the standards (IMTS 2010 and BPM6) or Australia's practical application?	Australia's international merchandise trade statistics	Australia's balance of payments - goods	Type of adjustment/treatment in Australia's balance of payments

Goods for processing	Difference in the standards.	Included.	Excluded if there is no change of ownership.	If there is no change of ownership the related processing services are included in manufacturing services on physical inputs owned by others.
Returned goods	Difference in the standards.	Included.	Where the transactions are significant in value terms the returned good and the original export are excluded. Otherwise the treatment is the same as Australia's international merchandise trade statistics.	Coverage adjustment.
Migrants effects	Difference in the standards.	Included.	Excluded if identified and the transactions are significant in value terms. Otherwise the treatment is the same as Australia's international merchandise trade statistics.	Coverage adjustment.
Illegal goods	Difference in the standards.	Excluded.	Included if identified and the transactions are significant in value terms. Otherwise the treatment is the same as Australia's international merchandise trade statistics.	Coverage adjustment.
Goods lost or destroyed after export (whether or not a change of ownership)	Difference in the standards.	Included in exports, excluded from imports.	Included in exports and imports if there is a change of ownership prior to loss or destruction, otherwise excluded from both. These goods are only identified and recorded differently in exceptional circumstances.	Coverage adjustment.
Goods for construction projects imported by non-residents	Difference in the standards.	Included. Note: All construction in Australia is treated as being by residents, therefore, there is no effective difference.	Excluded if identified and the transactions are significant in value terms. Otherwise the treatment is the same as Australia's international merchandise trade statistics.	Coverage adjustment.
Goods transferred to a buffer stock organisation	Difference in the standards.	Included.	Included if/when ownership changes otherwise excluded.	One example is a historical timing adjustment for wool.
Goods that cross borders between related parties	Difference in the standards.	Included.	Excluded if it is determined that there is no change of ownership and the transactions are significant in value terms.	Coverage adjustment.
Non-monetary gold	Difference in the standards.	Included if there is a physical movement of the gold across the customs frontier.	Included if there is a change of ownership whether or not there is a physical movement of the gold across the customs frontier.	Coverage adjustment.
Goods under merchanting(a)	Difference in the standards.	Excluded.	Included when there is a change of ownership.	Goods sold under merchanting are not included in international merchandise trade statistics. Net exports of merchanting data are compiled separately.
Difference in time of recording	Difference in the standards.	Exports are recorded when the goods leave Australia Imports are recorded when the declaration is finalised by the DIBP.	Goods are recorded when ownership changes.	Timing adjustment for high value transactions. For imports the timing adjustment may also cover differences between the time of change of ownership and the timing of finalised import declarations from the DIBP.
Mobile equipment, pipelines etc. that involve a change of ownership between a resident and a non-resident without crossing Australia's customs frontier	Difference in Australia's practical application.	Excluded.	Included.	Coverage adjustment.
Fish catch, minerals from the seabed and salvage which involve a change of ownership between a resident and a non-resident while outside Australia's customs territory	Difference in Australia's practical application.	Excluded.	Included.	Coverage adjustment.
Bunkers, stores, ballast and dunnage involving a change of ownership between a resident and a non-resident while outside Australia's customs territory	Difference in Australia's practical application.	Excluded.	Included.	Coverage adjustment.
Low value goods(b)	Difference in Australia's practical application.	Goods with values below the customs full declaration thresholds are excluded.	Included.	Coverage adjustment.
Statistical territory	Difference in Australia's practical application.	Statistical territory excludes Norfolk Is., Cocos Is., Christmas Is., Heard Is., McDonald Is., Ashmore and Cartier Is., Australia's Antarctic Territory, Australia's enclaves abroad and the JPDA.	For the balance of payments Australia's statistical territory aligns with its economic territory which includes Norfolk Is., Cocos Is., Christmas Is., Heard Is., McDonald Is., Ashmore and Cartier Is., Coral Sea Is., Australia's Antarctic Territory, Australia's enclaves abroad and the JPDA.	Coverage adjustment.
Value identified as incorrectly estimated or reported	Difference in Australia's practical application.	Included but value may be revised or incorrect.	Included but value may be revised.	Valuation adjustment until international merchandise trade data are revised.

(a) BPM6 defines merchanting as 'the purchase of goods by a resident (of the compiling economy) from a non-resident combined with the subsequent resale of the same goods to another non-resident without the goods being present in the compiling economy'.
(b) Measuring the value of low value goods is an encouragement in IMTS 2010. Encouragements are desirable practices.

12.8 There are also differences in the classification and presentation of goods credits (exports) and goods debits (imports) in the balance of payments. These are shown in Table 12.2 below:

TABLE 12.2: PRESENTATION OF MERCHANDISE EXPORTS AND IMPORTS IN AUSTRALIA'S BALANCE OF PAYMENTS


Australia' international merchandise trade statistics		Australia's balance of payments - goods component

Merchandise exports		Goods credits
	Classification of goods by HS, SITC, BEC		General merchandise
				Rural goods
				Non-rural goods
			Net exports of goods under merchanting
			Non-monetary gold

Merchandise imports		Goods debits
	Classification by HS, SITC, BoPBEC, BEC		General merchandise
				Consumption goods
				Capital goods
				Intermediate and other merchandise goods
			Non-monetary gold

12.9 The balance on goods and services is published in the monthly International Trade in Goods and Services, Australia (cat. no. 5368.0). This publication presents the major aggregates for, and the balance on, international trade in goods and services (on a balance of payments basis) in original, seasonally adjusted and trend terms. Each quarter, Australia's balance of payments is published in Balance of Payments and International Investment Position, Australia (cat. no. 5302.0). In this publication, the original quarterly data for the latest quarter is the sum of the monthly data published in International Trade in Goods and Services, Australia (cat. no. 5368.0) with any changes kept to a minimum. For information relating to the balance of payments compilation methods refer to Balance of Payments and International Investment Position, Australia: Concepts, Sources and Methods (cat. no. 5331.0).