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FOREIGN TRADE

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FOREIGN TRADE

DEFINITIONS AND EXPLANATIONS THE INVESTIGATED POPULATION The foreign trade data presented in this chapter deal with Israel's trade with other countries. The detailed data on imports and exports do not include the trade with the Palestinian Authority. The trade data, including the trade with the Palestinian Authority, are presented only in Table 16.1 - “Balance of Foreign Trade”. CLASSIFICATION OF COMMODITIES The import and export data of Israel are published according to two commodity classifications: 1. “The Standard International Trade Classification” prepared by the Statistical Bureau of the U.N. (Standard International Trade
Classification, Revised III, United Nations Statistical Office, Statistical Papers series 14, No. 34, New York, 1986)

VALUE OF COMMODITIES Export data presented in this Abstract (Tables 16.6-16.8) are classified according to the new classification of economic activities.
(Standard Classification of All Economic Activities 1993, Technical Series No. 63, Central Bureau of Statistics).

2. “The Harmonized System of Commodity Description and Coding” (the new commodities terminology) prepared by the Customs Co-operation Council (The Harmonized
Commodity Description and Coding System, Customs Cooperation Council, Brussels, June 1983).

This classification was revised by the Council in 1983 and introduced into use by Israeli Customs and the Central Bureau of Statistics in 1988. Therefore, data for 1988 and onwards cannot be compared with data for previous years. Further explanations on the classification are presented in Foreign Trade Statistics Quarterly, No. 4, 1988. Import data are also classified by economic use. In this classification, import items are categorized according to the first destination of the commodities. The classification is based on surveys conducted by the Central Bureau of Statistics every few years. These surveys investigate the use made in imports commodities. Exports data are classified also by technological intensity, according to the classification of the
OECD. (Classification of Manufacturing Industries based on Technology, OECD Science, 2001)

The distribution of products among the various industries is based on the commodity description in the classification of commodities and not on the exporter’s industry. Export figures classified by new industry can be obtained from the database of the Central Bureau of Statistics as of 1988. Imports are valued c.i.f. (cost, insurance and freight), including cost of wharfage and porterage (customs value). Exports are valued f.o.b. (free on board), before deduction of discounts and commission fees to foreign factors. The exception to this rule is exports of citrus, fresh fruit and vegetables and flowers. These exports are recorded here - and in other publications of the Bureau on exports - after deduction of all expenses abroad. In the Balance of Payments statistics (see Chapter 15), imports of commodities are presented on the basis of their f.o.b. value. The value of imports and exports, as presented in the balance of payments, was adjusted to the balance of payments definitions. CLASSIFICATION OF COUNTRIES Country of purchase: The country that sent the invoice for the goods imported to Israel. Country of destination: The country to which the invoice for the goods exported from Israel was sent.

IMPORTS
Imports are recorded according to the special system, representing total of imports passing directly through customs (including those for exchange and repair), or withdrawals from bonded warehouses; goods are considered imported when they are released by the customs authorities. Their release date determines the date of import.

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Gross imports refer to the value of flow of imported goods released by customs. Total net imports refers to the value of flow of commodities imported to Israel after deduction of returned imports. Unless otherwise stated, the data for imports refer to gross imports, i.e., imports without deduction of returned imports. Returned imports are those shipments returned abroad (without further processing) after previously having been imported to Israel. Average Payment by the Importer in Israeli Currency per US Dollar (Table 16.11) refers to all the importer’s expenses on imports, in NIS, on delivery from customs (i.e., the c.i.f. import value in NIS plus the taxes imposed on these imports), divided by the c.i.f. value of imports in US dollars. Taxes on imports include only those taxes, which were imposed on the importer upon the delivery of the goods from customs: customs duty, compulsory payments and purchase tax which does not include Value Added Tax. Total imports include among other things: Personal effects of immigrants; personal effects imported by tourists and not taken out of the country again; estimated value of presents received by mail, ships and aircraft; non-monetary gold and silver; shipments of commodities returned after their import and received again from abroad. The total import figures do not include: returned shipments of equipment to local firms from other countries after use in contract work; import into bonded warehouses; fuelling of ships and aircraft abroad; other commodities (such as food), ballast and dunnage supplied to Israeli ships and aircraft abroad; import of currency of legal tender; military equipment and weapons (the estimated value being included in the goods account in the balance of payments).

EXPORTS
Since March 1982, the date of statistical recording of exports is the date of the loading of the goods. From November 1962 till February 1982, the date of statistical recording of exports was the date of releasing the export entries by the customs authorities. Gross exports are defined as the gross value of outflow of goods from Israel whether they were totally or partially manufactured in the country, and whether they were imported

to Israel and sold abroad without further processing. Goods in the latter category include such items as polished diamonds, imported to complete the collection of gems offered for sale by Israel's manufacturers; aircraft and ships manufactured in other countries, imported and later sold after use. Since a considerable proportion of fresh agricultural produce is generally exported on a consignment basis, the values declared to the customs authorities upon shipment do not always represent the final sales value of the produce. As of the 1991/92 agricultural export season, following the dismissal of the Board of Citrus Marketing, exports are transferred to other companies. Consequently, most shipments arrive in Belgium, where they are bought by various agents, and so there is no information about the country of final destination. Also, the sale of flowers through the flower exchange is registered as exports to the Netherlands and cannot be classified by country of final destination. Net total exports are gross exports less returned exports. Returned exports comprise shipments returned from abroad (without further processing), which had previously been exported. Unless otherwise stated, all the data for exports refer to gross exports i.e., exports without deduction of returned exports. Total exports include among other things: personal effects which were exported by emigrants who left Israel; fuel and food supplied to foreign ships and aircraft in Israeli seaports and airports; the estimated value of gifts sent by mail; ships and aircraft. Since 1990, sales of unworked diamonds to foreign countries are recorded as exports, whereas they were previously recorded as returned exports and subtracted from the import data. Total exports do not include: shipments of engines and parts of aircraft by local firms to their branches or representatives abroad; shipments of goods imported returned for purposes of exchange, repairs, etc. These shipments appear under the heading Returned Imports; exports from bonded warehouses; export of currency of legal tender. As of Statistical Abstract 2001, data on exports of software from trade in commodities were deducted, because they

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are defined as services. Data on exports of commodities (other than software) for previous years, which are not published in the Statistical Abstract for 2001,can be obtained from foreign trade department of the Central Bureau of Statistics. INDICES OF PRICES, VOLUME AND VALUE Price indices measure the change which occurred in the average price of total imports, of total exports, or of a group of commodities, between two periods. The price of a single commodity is determined according to the average unit value of the exported or imported commodity. The definition of commodities is based on the classification used for customs tariffs (imports) and on the Classification of Export Commodities made in Israel. In these classifications, commodity groups do not always specify single items of a uniform quality, but may also specify groups of similar commodities. In some cases, the changes obtained in the price of the commodity, as it is defined in the classification, may also reflect changes in the various components of the commodity group. In such cases, price indices of similar commodities which are published abroad are used as a substitute for the average unit value. The information used to estimate price indices of foreign trade encompasses about 50 percent of the total import or export value. Once a year, the selection of items used for calculating the indices is checked and

updated. Indices are calculated on the basis of the previous year and are chained and presented in the publications on the basis of the average for 1980. Foreign trade price indices were calculated according to the Fisher formula, i.e., as a geometrical mean of the indices according to the Laspeyres and Paasche formulas. Foreign trade volume indices are intended to measure the quantitative changes which occurred between two periods in the total of imports and exports or of a group of commodities. The calculation of volume indices is also based on the Fisher formula. Value indices measure the changes in the value of imports and exports between two periods (without weighting). Exchange conditions measure the change in average export prices, relative to average import prices between two periods. Quarterly price and volume indices according to the Fisher formula are published in the Foreign Trade Statistics Quarterly. SOURCES The sources of the data are the forms submitted to the customs authorities by importers or exporters or their agents (import and export enteries). In special cases, data are derived from administrative summaries made by various institutions (as in cases of ship and aircraft records).

SELECTED PUBLICATIONS
SPECIAL PUBLICATIONS 952 Import Destinations Survey 1988 Foreign Trade Statistics - annual Imports, by commodities and countries, 1996-2001 (CD only) Imports, by commodities and countries, 2002-2003 (CD only) Exports, by commodities and countries, 1996-2003 (CD only)

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