NSCB - NSCB Technical Notes on the Estimates of the Philippine System of National Accounts (PSNA) Series 2006-Q1

NSCB Technical Notes on the Estimates of
the Philippine System of National Accounts (PSNA) Series 2006-Q1
(posted 03 July 2006)

Technical notes on the PSNA are regularly published in the NSCB website for a better appreciation of our national accounts. Reference should also be made to the earlier technical notes for the current national accounting practices adopted in the Philippines.

Merchandise Imports

NSO’s revisions on Merchandise Imports of components of consigned electronics for the period 2002–2004 (released in August 2005) were already incorporated in the National Accounts estimates of Merchandise Imports in the latest release of NSCB’s publication as of May 2006, covering the period 2003-2004. In accordance with the NSCB Revision Policy, the revision for 2002 will be incorporated during the over-all revision of the PSNA.

IT-enabled Services in the National Accounts Estimates

We were able to revise the 2003-2005 estimates for the BPOs/Call Center Industry, which is included under the Business Services subsector of Private Services with the availability of more complete data from the Business Processing Association of the Philippines (BPAP) beginning 2003.

Likewise, the Miscellaneous Services of the Exports of Non-Factor Services was revised to account for the under coverage of IT-enabled services/BPOs. In addition, export of Government Services was revised to account for the expenses on goods and services of embassies and international institutions.

Population Figures Used in the Accounts

The population figures used in the latest PSNA publication (as of May 2006) are estimates interpolated from the 2000 Census-based population projections for the quinquennial years from 2000 to 2040.

In the previous PSNA publications, the population figures used were interim estimates based on the extrapolation of the 2000 Census population count using the decennial growth rates from 1990 to 2000.

Revisions as of May 2006

Based on the Revision Policy approved by the NSCB Executive Board and consistent with the international practice on the revision of National Accounts, we are reflecting the corrections and revisions in our previous estimates, due to the revisions and updates made by the data sources themselves, including those made by NSO on Exports, Imports, MISSI, QSPBI, Building Permits, WPI, RPI and FTS; BSP on the BOP; the DOE and MGB for Mining and Quarrying; additional Financial Statements from source companies for ODRE; DBM and DOF for Construction; COA, DBM for Government Consumption; as well as POEA for NFIA; BAS, SRA, NIA & FMB for AFF; Cement Manufacturers Association of the Philippines for Manufacturing; and Financial Statements from PSE for Finance.

For 2003, there were revisions mostly coming from Private Services, Construction and Agriculture, Fishery and Forestry due to the incorporation of value added from BPO under Business Services, the updated estimates on BOT projects and updated data from BAS, respectively. On the expenditure side, the revisions came mostly from Merchandise Imports due to the correction made by NSO and Exports of non-factor services to account for the BPOs on the other side of the accounts. With the updated data on the Balance of Payments (BOP), NFIA was revised upward. As a result of all the revisions for 2003, GDP growth was revised upward from 4.5% to 4.9% while GNP growth was revised upward from 5.1% to 5.9%.

For 2004, the GDP growth was revised upward from 6.0% to 6.2% while GNP was revised upward from 6.2% to 6.7%. The biggest upward revision came from Private Services, again because of the BPO. Other upward revisions came from Agriculture, Fishery and Forestry, Finance and TCS. The biggest downward revisions were for Government Services due to new data from the COA and Construction due to updated data on BOT. On the expenditure side, the biggest upward revisions came from the corrected Merchandise Imports and the Exports of Non-factor Services, incorporating the contribution of the BPOs. The biggest downward revisions came from Durable Equipment, Import of Non-factor Services, Breeding Stocks and Construction. NFIA was likewise revised upward.

For 2005, the major contribution to the upward revision on the production side came from Private Services. This was followed by Agriculture, Fishery and Forestry, ODRE and TCS. Meanwhile, the largest downward revision came from Construction. Finance, Government Services and Trade also pulled down growth. On the expenditure side, Merchandise Imports, Merchandise Exports and Export of Non-factor Services provided the major upward revisions. NFIA was also revised upward. As a result, GDP growth was revised downwards from 5.1% to 5.0% while GNP was revised downwards from 5.7% to 5.6%, partly resulting from the upward revision in the 2004 levels.

For the First Three Quarters of 2005, Private Services and Construction contributed the most to the upward revision on the production side while Merchandise Imports and Export of Non-factor Services provided the major positive revisions on the expenditure side. NFIA was revised upward except for the third quarter. With these revisions, GDP and GNP were revised upwards for the first three quarters.

In the Fourth Quarter 2005, however, there were relatively big downward revisions in Construction and Finance due to new DOF data on the capital outlay of GOCCs and more complete results from the QSPBI. Growth was further dragged by Trade and Government Services. On the expenditure side, substantial downward revisions were made in Construction, Changes in Stocks and PCE. NFIA was revised upward because of the upward revision on Property Income and the downward revision in Property Expense from the BOP. As a result GDP was revised downwards from 6.1% to 5.3% while GNP was revised downward from 7.0% to 6.9%.

With all the revisions cited above in the sectoral estimates as well as on GDP and GNP from 2003-2005, it should be noted that these new estimates are not linked with the National Accounts series from 2002 backwards.

The Linked Series will be available in the fourth quarter of the year and its announcement will be posted in the NSCB website.

A more complete tabulation of our revisions is included in our publication of the National Accounts of the Philippine (as of May 2006).

For inquiries please contact:
Dir. Raymundo J. Talento
Tel.No.: (632) 895-2425
Email: rj.talento@nscb.gov.ph


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