C

A Comparison of U.S. Export Statistics With Those of Major Trading Partners

This note compares the accuracy of export statistics across five developed countries: the United States, Japan, West Germany, the United Kingdom, and Canada. The statistics analyzed in this note are those reported in the various issues of the Direction of Trade Statistics Yearbook published by the International Monetary Fund (IMF). These countries were selected for two reasons. First, they are the four largest importers of U.S. exports: the four countries' share of the total U.S. exports was 40.7 percent for 1980-1989 (see Table C-1). Second, they are also the important export destinations for other countries: the export shares of the other four countries in each country's total exports were: 42.6 percent for Japan, 18.7 percent for West Germany, 27.9 percent for the United Kingdom, and 79.0 percent for Canada (see Table C-1).

International experiences suggest that import data are in general more accurate (or are more seriously collected by officials) than export data, probably because of taxation and trade restrictions. Based on this observation, this note assumes that each country's import statistics represent true trade flows and treats the difference between an exporting country's export data and the corresponding importing country's data as an inaccurate portion of export statistics.

Most countries report their imports on the cost-insurance-freight (c.i.f.) valuation basis and their exports on the free-on-board (f.o.b.) basis. The c.i.f./f.o.b. ratios are different among countries, mainly due to each country's geographical location and trade contents.



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BEHIND THE NUMBERS: U.S. Trade in the World Economy C A Comparison of U.S. Export Statistics With Those of Major Trading Partners This note compares the accuracy of export statistics across five developed countries: the United States, Japan, West Germany, the United Kingdom, and Canada. The statistics analyzed in this note are those reported in the various issues of the Direction of Trade Statistics Yearbook published by the International Monetary Fund (IMF). These countries were selected for two reasons. First, they are the four largest importers of U.S. exports: the four countries' share of the total U.S. exports was 40.7 percent for 1980-1989 (see Table C-1). Second, they are also the important export destinations for other countries: the export shares of the other four countries in each country's total exports were: 42.6 percent for Japan, 18.7 percent for West Germany, 27.9 percent for the United Kingdom, and 79.0 percent for Canada (see Table C-1). International experiences suggest that import data are in general more accurate (or are more seriously collected by officials) than export data, probably because of taxation and trade restrictions. Based on this observation, this note assumes that each country's import statistics represent true trade flows and treats the difference between an exporting country's export data and the corresponding importing country's data as an inaccurate portion of export statistics. Most countries report their imports on the cost-insurance-freight (c.i.f.) valuation basis and their exports on the free-on-board (f.o.b.) basis. The c.i.f./f.o.b. ratios are different among countries, mainly due to each country's geographical location and trade contents.

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BEHIND THE NUMBERS: U.S. Trade in the World Economy TABLE C-1 Export Shares by Destination, 1980-1989 (in billions of dollars) Export Shares 1980 1981 1982 1983 1984 1985 1986 1987 1988 1989 10-Year Average U.S. exports (f.o.b.) to Japan, West Germany, United Kingdom, and Canada 79.8 84.1 74.6 79.4 91.3 90.2 94.1 113.9 139.8 160.5   to World 220.7 233.7 212.2 200.5 217.8 213.1 217.2 252.8 319.9 363.8   4 countries' share (%) 36.2 36.0 35.2 39.6 41.9 42.3 43.3 45.1 43.7 44.1 40.7 Japan's exports (f.o.b.) to United States, West Germany, United Kingdom, and Canada 43.9 52.9 49.1 57.8 75.9 83.0 104.7 112.1 123.0 127.2   to World 130.4 151.5 138.4 146.9 169.7 177.1 210.7 231.3 264.9 274.5   4 countries' share (%) 33.7 35.0 35.5 39.3 44.8 46.8 49.7 48.5 46.5 46.3 42.6 West Germany's exports (f.o.b.) to United States, Japan, United Kingdom, and Canada 27.8 26.4 27.6 30.1 34.6 39.3 52.5 62.1 66.3 67.2   to World 192.8 176.0 176.4 169.4 171.7 183.9 243.3 294.1 323.3 341.3   4 countries' share (%) 14.4 15.0 15.7 17.8 20.2 21.4 21.6 21.1 20.5 19.7 18.7 United Kingdom's exports (f.o.b.) to United States, Japan, West Germany, and Canada 25.5 26.5 25.1 24.4 26.3 30.1 32.0 39.2 42.5 45.2   to World 110.0 102.2 96.9 91.6 93.8 101.2 107.0 131.2 145.1 152.3   4 countries' share (%) 23.2 25.9 26.0 26.7 28.1 29.8 30.0 29.9 29.3 29.7 27.9 Canada's exports (f.o.b.) to United States, Japan, West Germany, and United Kingdom 48.9 53.9 53.4 60.7 73.6 75.1 74.2 80.3 93.5 97.2   to World 67.7 72.7 71.2 76.7 90.2 90.7 89.7 98.1 116.5 120.6   4 countries' share (%) 72.2 74.2 75.1 79.1 81.5 82.8 82.8 81.9 80.3 80.6 79.0 SOURCE: International Monetary Fund (1986b, 1990b).

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BEHIND THE NUMBERS: U.S. Trade in the World Economy This note uses the c.i.f./f.o.b. factors (CFF) shown in the IMF's International Financial Statistics. The CFF series originate from the balance-of-payments statistics; a country's total costs for freight and insurance are computed as differences between its imports (c.i.f.) and its trading partner 's corresponding exports (f.o.b.). The CFFs are “average” figures for the total imports. Nonetheless, using them is probably better than just using the 1.1 figure usually applied by other researchers for some countries. (The CFF series used in this note can be found in International Financial Statistics Yearbook, 1989.) The yearly data for each country from 1980 to 1989 are examined as follows: is the country's exports (f.o.b.) to the other four countries (in millions of dollars); is the other four countries' imports (c.i.f.) from the country concerned (in millions of dollars); is the other four countries' imports, expressed in (f.o.b.) terms, from the country concerned (in millions of dollars), is the discrepancy on an f.o.b. basis (in millions of dollars), (d) = (a)−(c); is the discrepancy on an f.o.b. basis, expressed in percentage terms, The table below shows the 10-year average discrepancies (in current prices) and discrepancy percentages from 1980 to 1989 for each country. Since the absolute magnitudes of discrepancies vary with the size of each country's exports, the discrepancy percentages are a better measure for international comparisons of the accuracy of countries ' statistics than the magnitudes.   Discrepancy Country $ Millions Percentages United States −7,734 −7.96 Japan 92 0.36 West Germany 30 0.00 United Kingdom −1,163 −4.04 Canada 689 1.13

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BEHIND THE NUMBERS: U.S. Trade in the World Economy The discrepancies and discrepancy percentages of Japan, West Germany, and Canada are close to zero (on average), while those of the United States show large negative figures. This difference suggests that the U.S. export statistics may be less accurate than those of Japan, West Germany, and Canada. If so, trade deficit figures announced by the United States may have been overstated. The U.S. discrepancies and discrepancy percentages appear to be smaller in the recent years, which might indicate the recent improvement of the U.S. export statistics. The discrepancy percentage of Canada may be biased in the positive direction for several reasons: the main destination of Canada's exports is the United States; Canada and the United States are geographically close, and thus freight and insurance costs are probably lower than those for trade destined for other countries; the U.S. import data are converted from the c.i.f. basis to the f.o.b. basis by using the “aggregate” conversion factors. Therefore, the data on U.S. imports from Canada (f.o.b.) may be understated. A part of the large discrepancies of the U.S. export statistics might come from their trade contents. If the accuracy of import statistics is positively related to the magnitude of trade restrictions, import data of agricultural trade may be more accurate than those of manufactured goods, because agricultural trade is generally more restricted than manufactured goods trade. If so, the discrepancies of agricultural exports may be biased in the negative direction compared with those of manufactured goods exports.