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A PRESENTATION ON THE STATUS OF ECONOMIC STATISTICS (MANUFACTURING) IN UGANDA

A PRESENTATION ON THE STATUS OF ECONOMIC STATISTICS (MANUFACTURING) IN UGANDA. By John Bonaventure Musoke Senior Statistician. “A CANDLE LOOSES NOTHING BY LIGHTING ANOTHER CANDLE”. Prof. Ssenteza Kajubi. Content. The Business Register 2001/2002 and 2006/7 Uganda Business Inquiry 2000/2001

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A PRESENTATION ON THE STATUS OF ECONOMIC STATISTICS (MANUFACTURING) IN UGANDA

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  1. A PRESENTATION ON THE STATUS OF ECONOMIC STATISTICS (MANUFACTURING) IN UGANDA By John Bonaventure Musoke Senior Statistician www.ubos.org

  2. “A CANDLE LOOSES NOTHING BY LIGHTING ANOTHER CANDLE” Prof. Ssenteza Kajubi www.ubos.org

  3. Content • The Business Register 2001/2002 and 2006/7 • Uganda Business Inquiry 2000/2001 • Index of Industrial Production (IoP – M) • Producer Price Index (PPI) • Challenges www.ubos.org

  4. The Business Register 2001/2002 Defn: A business register is a record of all active business establishments. Essentially it contains structural information about each business. • Objectives - Create a comprehensive list of businesses • Provide a frame for future business surveys www.ubos.org

  5. The Business Register ….. • Prior to the start of the Registration exercise an attempt was made to compile the register from administrative sources; • The Uganda Revenue Authority • Uganda manufacturers Association (UMA) • Uganda Investment Authority etc. www.ubos.org

  6. The Business Register ….. • Variables collected • Name of Establishment, Activity ( ISIC), Location, GPS Coordinates, Tel:, Postal Address, Employment by sex, Type of Ownership, Start date, if enterprise – name. www.ubos.org

  7. The Business Register ….. • Coverage We covered all businesses operating from a fixed location, regardless of employment size band A total of 160,883 businesses were registered out of which 11,968 were for manufacturing www.ubos.org

  8. THE UGANDA BUSINESS INQUIRY (UBI) 2000/2001 Defn: This is an economic survey covering all sectors in the economy for the financial year 2000/2001 www.ubos.org

  9. UBI Cont……… • Objectives • Compute VA for estimating GDP • Estimate capital Formation • Update input output table • Compile SAM • Update weights for IIP • Establish wts for PPI www.ubos.org

  10. GO and VA for manufacturing 2000/1 www.ubos.org

  11. Annual Business Inquiry 2006/7 • In order to produce high frequency data that can enable us update these important indicators we are now carrying out an ABI with ref. yr 2006/7. We finished data collection and have just finished data entry. A draft report is expected around July 2009. www.ubos.org

  12. Index of Production (Manufacturing) By John B. Musoke www.ubos.org

  13. Historical Background of IIP • Work started in 1990 after the Census of Business Establishments (COBE) • The IIP was based mostly on measuring quantities of production for products available in the base period. www.ubos.org

  14. Errors within the IIP System • Challenges encountered in using Quantity to measure volume change…. • Establishments that close • New Establishments and products • Non Homogeneous products • Conversion factor related problems or problems related to human error www.ubos.org

  15. Index of Production (IoP) • Index rebranded IoP to expand and Cover • Manufacturing • Services • Utilities • Mining www.ubos.org

  16. IoP – Manufacturing……. • The index computation mostly utilizes deflated Sales values to measure change. It still remains a volume/quantity index. Q * P = V Q = V/P Qindex = Vindex/Pindex www.ubos.org

  17. IoP – Manufacturing……. • Just as PPI, data for IoP is collected from formal manufacturing across the country majority of it coming from the industrial belt of Uganda C:\Documents and Settings\john.musoke.UBOS.000\My Documents\Maps\ugandan map1.doc www.ubos.org

  18. IoP – Manufacturing……. • Monthly data is collected on a quarterly basis but entered by month in an Excel data file.(IoP DATA SALES) There are three sources of data:- • Survey data • VAT data • Quantities data from mandated Authorities www.ubos.org

  19. IoP – Manufacturing……. • The index is derived in two steps: • First, for each “basic heading” (product or activity group) a value index is compiled by adding total turnover for each business (no weighting – full coverage assumed) • The value index is then divided by a corresponding price index (PPI) • This operation delivers volume indices at “basic heading” level www.ubos.org

  20. IoP – Manufacturing……. • Second, these basic level indices are combined using the Laspeyres formula into the major Divisions/Groups and all Manufacturing. • The weights used to aggregate are based on gross value added taken from the UBI www.ubos.org

  21. IoP – Manufacturing……. • The index is based on 2002 • Until June 2004, the basic heading indices were based on the old system (quantities) • From July 2004 onwards, deflated turnover has been adopted in most cases • The new indices are “linked” to the old before being aggregated. www.ubos.org

  22. IoP – Manufacturing……. Quality control (Sales are much more variable than prices and more subject to error) • We calculate the response rates based on known (or assumed) average values of turnover in the previous 12 months and impute for non-respondents. • We check the month-to-month change in sales values and query large changes www.ubos.org

  23. IoP – Manufacturing……. • Challenges • Correcting outliers with VAT data. • Reliability of monthly series • Using survey data – small economy • Using survey data – few estabs. www.ubos.org

  24. UGANDAS EXPERIENCE WITH THE PRODUCER PRICE INDEX (LUSAKA 4th – 7th May 2009) www.ubos.org

  25. What is a Producer Price Index (PPI)? • PPI is a PRICE index (number) used to measure the rate of change in the prices of goods and services bought and sold by producers. • PPIs can differently be calculated to suit specific goals thus we have a PPI for Manufacturing • PPIs for Mining and Quarrying, Agriculture, Hotels and Utilities are in the initial stages of development. www.ubos.org

  26. Output PPI.. • UBOS started compiling PPIs (Manufacturing) in 2004.What is generated is an output PPI which measures the rate of change in the prices of products sold as they leave the producer. • The PPI generated is categorized btn. - the Local Market (PPI for Local Market) - for goods and services produced for export, (PPI for Exports) • And PPI combined which combines the two above www.ubos.org

  27. Which PPI are we measuring? • PPI-M measures both goods produced for the local market and those produced for export. • This PPI covers the ‘formal’ Manufacturing sector • It measures the change in the effective unit selling prices received by manufacturers for products sold for both the home market and for exports. www.ubos.org

  28. PPI - M cont… • Products are priced at Basic Price • Basic Price is the price per unit of goods/ services receivable by the producer. Because the producer does not receive taxes on products but does receive subsidies. Taxes on products (excise, non-refundable VAT, taxes on exports, etc) are excluded, while subsidies on products are included. www.ubos.org

  29. Methodology & Sample Size determination WHY PPI was generated? • Out of the UBI which was conducted in 2000/01, the Bureau then had comprehensive data on Value Added (VA) and Gross Output (GO) for establishments. The data on GO was then used for generating weights for PPI-M. www.ubos.org

  30. Methodology Ctd • The PPI Manufacturing is based on a sample of establishments with 10 or more employees as reported during the UBI. • A wide range of representative products were selected in July 2004 • PPI-M covers all ISIC Manufacturing Divisions from 15 to 37 (Table of ISIC) www.ubos.org

  31. Methodology Ctd • A sample of 200 establishments as of now are covered in the PPI with close to 600 products. • The sampling method used was Probability Proportional to size combined with Concentration of businesses and personal judgment based on previous data/information. • There are 36 main headings based on 4-digit ISIC. www.ubos.org

  32. Challenges before • Establishments that close • Inclusion of new establishments and products • Non Homogeneous products • Conversion factor related problems or problems related to human error www.ubos.org

  33. Methodology Contd… • These are collapsed into 21 groups. Closely related activity codes producing almost homogenous commodities are grouped together to form the 21 as shown in the table. • Which are later put into 8 major headings which are re-grouped to suit the requirements in National Accounts. www.ubos.org

  34. Challenges after • Correcting outliers within VAT data files. • Variability of monthly sales/ turnover series • Using survey data – respondent fatigue • Using survey data – few establishments • Need for specialized respondents • Harmonizing data collection within UBOS and without www.ubos.org

  35. Challenges cont… • Getting transaction prices (actual) other than price-list prices. www.ubos.org

  36. www.ubos.org

  37. Thank You PLOT 9 COLVILLE STREET P.O BOX 7186 KAMPALA TEL. 041-706000 FAX 041-237553 E-MAIL ubos@ubos.org Website www.ubos.org WELCOME TO UGANDA WELCOME TO STATISTICS HOUSE www.ubos.org

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