Data Availability

Pages:9-18
SUMMARY

FDI Statistics Compiled by International Organizations FDI Statistics Shown in the IMF's Balance of Payments Statistics Yearbook FDI International Recommendations and Their Implementation Discrepancies in Global Balance of Payments Statistics on FDI FDI capital flows FDI investment income Discrepancies in Bilateral FDI Stock Data

 
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FDI Statistics Compiled by International Organizations

4.1 Many countries compile and disseminate in national publications and/or websites information on FDI, typically in the context of balance of payments and IIP statistics. To facilitate analysis, these statistics are often extended to provide geographic information on FDI transactions and positions vis-à-vis individual partner countries or regions. Many countries also compile FDI statistics broken down by industrial sector.

4.2 Various international and regional organizations -such as the IMF, the OECD, UNCTAD, and Eurostat 1 -have long-established programs for the collection and dissemination of these FDI statistics and also work with countries to improve data compilation practices in this area of statistics. 2 The IMF's statistics on direct investment are disseminated as a component of the balance of payments and IIP statistics, while the other organizations have publications devoted to FDI statistics.

4.3 The primary publications (all annual) of these four organizations that cover FDI statistics are:

- IMF's Balance of Payments Statistics Yearbook ( BOPSY );

- OECD's International Direct Investment Statistics Yearbook;

- UNCTAD's World Investment Report; and

- Eurostat's

European Union Foreign Direct Investment Yearbook.

4.4 Both the IMF and UNCTAD compile global statistics on FDI, whereas the focus of the OECD and Eurostat is on a narrower group of countries. UNCTAD's World Investment Report contains world tables that aggregate national data on both FDI transactions and stocks and also provides a comprehensive analysis of issues related to FDI, which in recent years have included cross-border M&A (2000 edition) and operations of transnational corporations (2002 edition). The IMF's BOPSY contains world tables on FDI capital flows and investment income. The OECD and Eurostat disseminate information on the geographic breakdown of FDI transactions and stocks vis-à-vis selected partner countries. The OECD and Eurostat also disseminate data on FDI transactions and stocks by industrial sector. The IMF does not disseminate geographic or industrial sector breakdowns of FDI statistics.

4.5 In late 2002, the OECD updated an earlier joint IMF-OECD survey to explain significant differences that were found to exist in the FDI data that each organization disseminated. Because both institutions adopt common methodological recommendations, the data that countries report to the two institutions should, in principle, be identical or very similar. The study, based on reports from 26 of the 30 OECD countries surveyed, showed that there were differences in the following areas:

- Methodology and coverage. Twenty-two of the respondents apply the same methodology in reporting to the IMF and the OECD. However, four countries-Denmark, Japan, Korea, and the United States-apply different methodologies. 3 In Page 10 addition, the coverage of the data of three countries -Germany, Iceland, and Switzerland-differs between the two sets of data. Iceland and Switzerland exclude real estate, and Germany excludes both real estate and reverse investments from the data reported to the OECD, while including these items in the data reported to the IMF.

- Data sources. Japan and the United States use different sources for the data reported to the IMF and those reported to the OECD.

- Reporting periods. The data that Japan reports to the OECD are compiled on a fiscal year basis, while the data reported to the IMF are on a calendar basis.

- Time of reporting. There are significant differences in the time of reporting the original data and revised data to the IMF and to the OECD. Only 11 countries send the primary data to both organizations at the same time; only 8 of those 11 countries also send revised data to both organizations at the same time for both flows and stocks.

- Reporting of revisions. Only 19 countries send revisions of FDI transactions data to both organizations for the same number of years, while only 17 countries cover the same number of years for submitting revised FDI position data.

4.6 A comparison was also undertaken of the IMF and UNCTAD data sets for FDI stocks of individual countries for selected years. The statistics were found to be broadly comparable. 4 Differences could largely be explained by the following: different publication release dates, which can involve the availability of revised data at different times; the data reported by member countries to the IMF are a mixture of both book values and, for a number of countries, market values, whereas UNCTAD uses book values to the extent possible; and the UNCTAD data contain estimates for countries that have not reported stock data or that do not compile these data.

FDI Statistics Shown in the IMF's Balance of Payments Statistics Yearbook

4.7 FDI statistics are reported to the IMF's Statistics Department as part of national submissions of balance of payments and IIP statistics for publication in BOPSY and International Financial Statistics (IFS). The 2002 BOPSY contained balance of payments statistics for 164 economies, about the same number as in the 1996 issue. Over that six-year period, about two dozen countries, mostly in Africa, fell behind in the reporting of balance of payments statistics, but this decline has been largely offset by an increase in the number of reporters from other parts of the world. Of the 164 countries, 140 reported data for 2000/2001.

4.8 Member countries are now reporting more component detail on FDI, which reflects the availability of data from new collections as well as improvements in classification. Figure 4.1 compares the number of countries that reported information for the components of FDI capital flows published in the 1996 and 2002 issues of BOPSY (using data for 1994 and for 2000 and 2001 from these publications). 5 It shows that between the reporting periods 1994 and 2001, the number of countries reporting data on reinvested earnings on outward direct investment nearly doubled to 45, while reporting of reinvested earnings on inward direct investment increased by more than a quarter to 84. The number of countries reporting inward data on equity capital also increased significantly, from 92 in 1994 to 123 in 2001 and from 55 to 66 for the outward data. The increases for the data on other capital were from 76 to 91 for the inward data, and from 31 to 54 for the outward data.

4.9 There has been an even more significant improvement in reporting of IIP statistics on direct investment for inclusion in BOPSY, where the number of reporting countries more than doubled, from 30 to 70, as measured in a study conducted in January 2003 (see Figure 4.2). 6 Within the IIP category of direct investment, many countries reported additional component detail in recent years, especially for the other capital component of FDI (that is, inter- company debt). About three times more countries reported data on other capital in 2001 than in 1994 (increases from 16 to 54 for the inward data and from 16 to 46 for the outward data). There were similarly significant increases in the numbers that reported data on equity capital and reinvested earnings (from 24 to 66 for the inward data and from 23 to 60 for the outward data).

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Figure 4.1. Countries Reporting FDI Capital Flows to the IMF Statistics Department- 1994, 2000, and 2001 5A

(Figure in Pdf File)

4.10

At the national level, countries sometimes supplement their published FDI statistics with various metadata (that is, information on the data) that explain to users of the statistics how the data were compiled, including information on the concepts and definitions employed. At the international level, surveys have been conducted across a range of countries to provide an understanding of FDI recording practices. Such a survey was conducted in connection with the IMF's 1992 Report on the Measurement of International Capital Flows (the Godeaux Report ). More recently, there have been two joint IMF-OECD surveys. The first, which was conducted with respect to compilation and dissemination practices in 1997, was called the Survey of Implementation of Methodological Standards for Direct Investment (SIMSDI), and the second, which reviewed recording practices in 2001, was referred to as the 2001 SIMSDI update. The latter covered 61 of the 114 economies that participated in the 1997 SIMSDI.

4.11 The results of the 2001 SIMSDI update were published by the IMF in October 2003 as Foreign Direct Investment Statistics: How Countries Measure FDI 2001. 7 The report provides detailed information on data availability, data sources, deviations from the international recommendations, etc. Key findings and selected FDI recording issues from the 2001 SIMSDI update are discussed in Chapter 6.8

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Figure 4.2. Countries Reporting FDI Positions to the IMF Statistics Department- 1994, 2000, and 2001 7A

FDI International Recommendations and Their Implementation

4.12 There are a number of methodological materials available to national compilers that provide conceptual and practical guidance in the compilation, analysis, and dissemination of FDI and other external sector statistics. The BPM5 provides guidance to member countries in the compilation of balance of payments and IIP statistics, and the OECD's Benchmark Definition provides operational guidance on how FDI should be compiled to meet the internationally agreed...

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