DOF ECONOMIC BULLETIN ON TRADE DATA DISCREPANCY Trade data discrepancy occurs when trade data reported by a country differ from those reported by its trading partners. This occurs due to a variety of reasons, including the following:
1. Timing differences;
2. Smuggling;
3. Valuation differences;
4. Differing treatment of re-exports and transshipment;
5. Wrong attribution; and
6. Misinvoicing. (Accounting for Discrepancies in Bilateral Trade: The Case of China, Hong Kong, and the United States Michael J. Ferrantino and Zhi Wang Office of Economics, U. S. International Trade Commission April 2007) A comparison between trade data reported in the IMF Direction of Trade Statistics and the Philippine Statistics Authority (PSA) shows that trade data discrepancy declined from 40.8% in 2015 to 33.1% in 2017. This implies less of the problems identified above.
Import data discrepancy declined from 40.9% in 2015 to 27.0% in 2016 but edged up slightly to 27.5% in 2017.
Export data discrepancy rose from 40.8% in 2015 to 53.3% in 2016 but dropped to 33.1% in 2017.
TABLE 1. TRADE
DATA DISCREPANCY
IMPORTS
2015 2016 2017
NSO Data
(Imports), US$M 76,042 89,994 102,008 Trading Partners'
Data (Exports
100,120
106,841
121,553 to the
Philippines), US$M
Adjusted for I&F 107,128 114,320 130,062 Discrepancy, US$M 31,087 24,325 28,053 % of Total 40.9% 27.0% 27.5%
EXPORTS
2015 2016 2017
NSO Data (Exports) 58,827 57,406 66,963 Trading Partners' Data
(Imports
77,402
82,237 88,595 from the
Philippines)
Adjusted for I&F 82,820 87,994 94,797
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Discrepancy 23,993 30,588 27,834
% of Total 40.8% 53.3% 41.6%
TOTAL TRADE
2015 2016 2017
NSO Data (TOTAL
TRADE) 134,869 147,400 168,971
Trading Partners' Data
(Imports & 177,522 189,078 210,148
Exports from/to the
Philippines)
Adjusted for I&F 189,949 202,313 224,859
Discrepancy 55,080 54,913 55,888
% of Total 40.8% 37.3% 33.1%
Sources of basic data: Philippine Statistics Authority and International Monetary Fund,Direction of Trade Statistics
DOF View
The drop in trade discrepancy data indicates the upgraded capability of tax collectors to assess and collect properly tax revenues from taxpayers. Automation of trade processes thru the TradeNet which will go live on December 2018 will further reduce trade data discrepancy, improve revenue collectors’ capabilities and at the same time, facilitate trade.
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