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Recording of factoryless goods production in international trade changes

 

The recording of so-called factoryless goods production in international trade will change in the National Accounts starting from the statistical reference year 2014. A factoryless goods producer refers to an enterprise that no longer has own factories in its home country, but whose planning, research and product development, administration and marketing are located in Finland. A significant part of the value of end products ordered by the enterprise consists of the use of intangible assets owned by the enterprise. Previously, the margin from factoryless goods production or net sales from abroad to abroad was Finnish service exports. Starting from the statistical reference year 2014, the margin in question is recorded as Finnish goods exports. In supply and use tables, the recording by product changes from a service product to a good in accordance with the sold end product. The recording change decreased service exports and increased goods exports by EUR 1.1 billion in the statistical reference year 2014. Total exports of goods and services did not change.

The European System of Accounts ESA 2010 adopted in summer 2014 and the new Balance of Payments Manual BPM6 harmonised with ESA 2010 introduced changes to the recording of global production or goods sent abroad for processing and merchanting. The manuals do not, however, discuss factoryless goods production. The Guide to Measuring Global Production compiled by the United Nations Economic Commission for Europe (UNECE) contains recommendations on recording factoryless goods production in National Accounts but no final international decision has been made. The guide recommends that factoryless goods production is recorded in foreign trade of goods.

The new data on international trade will be released in the annual National Accounts publication on 31 January 2017. The methodological change also applies to the following publications of Statistics Finland: Input-output 2014 on 9 February 2017, Quarterly national accounts on 1 March 2017, Balance of payments and international investment position on 15 March 2017 and International trade in goods and services on 15 March 2017. Time series prior to the year 2014 will be revised later.

 

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Last updated 9.2.2017