Canadian International Merchandise Trade (Balance of Payments Basis)

Detailed information for January 2008

Status:

Active

Frequency:

Monthly

Record number:

2202

This activity consists of adjusting the values of Canada's imports and exports from the Customs basis to the Balance of Payments basis.

Data release - March 11, 2008

Description

This activity consists of adjusting the value of Canada's imports and exports from the Customs basis to the Balance of Payments basis. Information on imports and exports are inputs into the Canadian System of National Accounts, particularly in the Balance of Payments and Gross Domestic Product, and are used in the formulation of trade and budgetary policies. Governments, importers, exporters, manufacturers and shipping companies use trade statistics to monitor import penetration and export performance, monitor commodity price and volume changes and examine transport implications.

Canadian International Merchandise Trade (Customs basis) is the main source of data for trade in goods for the Balance of Payments basis. However, there are conceptual differences concerning the coverage, time of recording, valuation and classification of goods transactions between Customs and Balance of Payments that require adjustments to Customs data for use in the Balance of Payments.

Key differences exist between Customs and BOP based data. On a BOP basis, transactions are defined in terms of ownership change between residents and non-residents (i.e., BOP trade can sometimes occur completely within or outside of Canada). On a Customs basis, a transaction occurs when a good crosses the border. Other major differences involve the country of attribution for imports (BOP is country of shipment; Customs is country of origin) and valuation (most notably: freight for BOP purposes is moved out of merchandise trade and into transportation services).

BOP adjustments to Customs data are frequently carried out at aggregate levels (both for commodity and country groupings), making the direct relationship of detailed Customs data to the BOP data difficult where possible at all. BOP data are available for commodity groups and their aggregates at the national level and at the "all commodity" level for Canada's Principal Trading Partners (Algeria, Australia, Belgium, Brazil, China, European Union, France, Germany, Hong Kong, India, Indonesia, Iraq, Italy, Japan, Mexico, Netherlands, Norway, Peru, Russian Federation, Saudi Arabia, Singapore, South Korea, Spain, Switzerland, Taiwan, Turkey, United Kingdom, United States).

Statistical activity

The Canadian System of National Accounts (CSNA) provides a conceptually integrated statistical framework for studying the state and behavior of the Canadian economy. The accounts are centered on the measurement of activities associated with the production of goods and services, the sales of goods and services in final markets, the supporting financial transactions, and the resulting wealth positions.

To produce financial statistics, the CSNA measures the economic dimensions of the public sector of Canada, including the financial inter-relationships among the thousands of entities that make up the three levels of government in Canada (federal, provincial and territorial, and local). In order to carry out this program, the CSNA maintains a universe of all public sector entities including their complex inter-relationships.

Reference period: Month

Collection period: Calendar month

Subjects

  • Balance of international payments
  • Economic accounts
  • International trade
  • Merchandise exports
  • Merchandise imports

Data sources and methodology

Instrument design

This methodology does not apply.

Sampling

This methodology does not apply.

Data sources

Data are collected from other Statistics Canada surveys and/or other sources.

Data on Canadian merchandise trade are obtained on a Customs basis from the Canadian International Merchandise Trade (Customs Basis) - Statistical Program # 2201.

Additional inputs are sourced from other Statistics Canada programs.

Error detection

This methodology type does not apply to this statistical program.

Imputation

This methodology does not apply.

Estimation

The Customs basis data are aggregated by commodity and Principal Trading Partner, and pertinent adjustments are made to convert them to the Balance of Payments basis.

Overall, the adjustments on exports are more numerous and sizeable than on imports.

Quality evaluation

Aggregated data are subject to month over month and year over year analysis to detect errors and explain observed movements.

The models used to seasonally adjust are reviewed annually by the Business Survey Methods Division of Statistics Canada.

Disclosure control

Statistics Canada is prohibited by law from releasing any information it collects which could identify any person, business, or organization, unless consent has been given by the respondent or as permitted by the Statistics Act. Various confidentiality rules are applied to all data that are released or published to prevent the publication or disclosure of any information deemed confidential. If necessary, data are suppressed to prevent direct or residual disclosure of identifiable data.

The Canadian International Merchandise Trade Program (CIMTP) of Statistics Canada is similar to most other countries in its use of administrative data derived from Customs sources to produce merchandise trade data and its use of the 'passive suppression' approach for confidentiality. Passive suppression is based on the principle that confidential data will not knowingly be released. It requires that appropriate measures be taken only at the request of importers or exporters who feel that their interests would be harmed by the dissemination of data. The onus of notifying CIMTP of suspected instances of the release of confidential data rests with the affected companies.

Revisions and seasonal adjustment

Revisions - In general, merchandise trade data are revised on an ongoing basis for each month of the current year. Current year revisions are reflected in both the customs- and balance of payments-based data.

Beginning with the January 2008 reference month, the previous year's customs and balance of payments data (i.e., 2007) will now be revised with the release of the January, February and March data months. Revisions to customs-based data for the previous year will continue to be released on a quarterly basis. Revisions to customs-based data for the three previous years will be available when the December reference month is released.

Factors influencing revisions include late receipt of import and export documentation, incorrect information on customs forms, replacement of estimates with actual figures, changes in classification of merchandise based on more current information, and changes to seasonal adjustment factors.

Seasonal Adjustment - Both export and import statistics show large monthly fluctuations. In order to isolate turning points or trends in the basic data, it is necessary to eliminate this effect of seasonal movement. Statistics Canada uses the X-11-ARIMA (Dagum, 1975 and 1979) method to remove seasonal fluctuations from time series.

See record no. 2201 - Canadian International Merchandise Trade (Customs Basis) - for a full description on seasonal adjustment.

Data accuracy

The administrative data used to compile trade statistics is considered to be complete and accurate. Any anomalies or inconsistencies detected are verified with the source, and where necessary, adjustments are made to reconcile data with the conceptual framework of the series. The administrative agencies used are considered to be the best source available.

It is not unusual for the accuracy of export statistics to be adversely affected by undercoverage and/or country misallocation. While Statistics Canada does not have a direct measure of undercoverage, a monthly estimated adjustment is included within balance of payments based data. Country misallocation occurs when the country of final destination is inaccurately reported on the Customs documentation. This occurs most frequently when goods are routed through an intermediary country before continuing to their final destination with the intermediary country being reported as the final destination of the goods.

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