CHAPTER D. SOURCES: INDUSTRIAL OUTPUT AND IMPORTS
General
The data of the Input-Output Tables for 1995 are based on a number of main sources:
–
The current statistical data of the CBS, such as data from the National Accounts
and the Manufacturing and Crafts Surveys, as well as data on imports and exports.
In most of these instances the data have been processed and completed in order to
adapt them to the usual definitions in the Input-Output Tables.
–
Surveys conducted especially for 1995 to construct Input-Output Tables, such as
Trade, Services, Transport and Communication Survey, and Survey of Products
and Materials in Manufacturing
–
Data from external sources, such as The Banking System in Israel: An Annual
Survey – 1995 (Hebrew only).1
–
Profit-and-loss reports that were obtained directly from companies for specific
industries, such as communications and transport, electricity and water.
These sources were used for preparing data of outputs, final uses and industrial inputs.
Breakdown of Data Sources
In general, the industrial output is defined as production of goods and services designated
for use as inputs in other industries or for final use. The system of preparation of the
different industrial outputs and inputs estimate is described hereby.
1. Agriculture Industry
The data are based on measuring of the output and input products (the annual statistics
for the industry), and on estimates of the uses of inputs in each industry. The original data
in the annual statistics are presented by products or groups of products. For the
preparation of the tables they were aggregated into 32 industries. In addition, the tables
include four industries whose products are imported (green coffee, natural rubber, cocoa
beans and bulk tea).
The agricultural output, as defined in the Input-Output Tables, is presented at basic
prices, including intermediate inputs (purchases and sales among agricultural industries),
own consumption and the production of capital assets
Data on total inputs in agriculture (water, fertilizers, food, etc.) are published annually. It
was necessary to specify the various items in order to classify them by industry of origin
and to assign each of the detailed inputs to 32 groups (minor industries). The preparation
of estimate of the inputs in agricultural industries was partially based on calculations of
HaMerkaz HaHaqlai (the Agricultural Centre), Agudat HaHaqlaim (the Agriculturist
Cooperative) and the Extension Services of the Ministry of Agriculture.
1
Bank of Israel, Supervisor of Banks. Jerusalem, 1996.
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2. Manufacturing Industry
2.1 Outputs of Manufacturing Industries
The main source of the data for manufacturing output in the Input-Output
Tables is the Manufacturing and Crafts Surveys – 1995,1 which regarded
establishments that employed five persons or more and consisted of a
sample of about 2,400 establishments. Estimates were prepared for
establishments employing one to four persons. Another source was Survey
of Products and Materials in Manufacturing – 1995,2 which also referred
to establishments employing five persons or more. This survey enabled the
classification of the different products manufactured in each industry by
characteristic industry of origin, and the classification of materials by
industry of origin.
The Manufacturing and Crafts Surveys – 1995 do not include the diamonds
industry, whose data were obtained from other sources.
The manufacturing output is defined in the Input-Output Tables as incomes
from manufacturing activity and other incomes (excluding incomes from
capital profits), plus the change in the inventories of finished products and
work in progress.
The inputs in the manufacturing industry include:
– Raw materials (detailed by industry)
– Auxiliary and packing materials
– Petroleum, electricity and water
– General expenses (advertising, insurance, communications services,
legal expenses, accountants' services, etc.).
The data presented in the tables are of consumption of materials. The
change in inventories of materials appears as a part of the final uses.
2.2 Labour Compensation in the Manufacturing Industries
The data on labour compensation in the manufacturing survey refer only to
employees. The labour compensation data in the Input-Output Tables have
to reflect also the work of owners engaging employees and of selfemployed. Therefore the required imputations were done in this group on
the basis of annual average wages of employees in the same industry,
multiplied by the number of owners and non-paid family members as
registered in the survey.
2.3 The Diamonds Industry
The diamonds industry has not been investigated in the manufacturing
survey for many years. Data for this industry are obtained from other
sources. The output of the industry was estimated by data on export of
polished diamonds plus consumption of non-residents (estimate of tourists'
1
2
CBS. Publication No. 1091. Jerusalem, 1998.
CBS. Publication No. 1123. Jerusalem, 1999.
- (37) -
purchases in Israel) and change in the inventories of polished diamonds
(according to estimates of the National Accounts). Similarly, in calculating
the output, returned exports and commission fees for exports were taken
into consideration.
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3.
Electricity and Water Industries
3.1 Electricity (400)
The output of the electricity generation industry is defined as the total
income from electricity sales of the Israel Electric Company Ltd.
Data on income and expenditure in the electricity industry are based on
information obtained from the profit-and-loss reports of the Israel Electric
Company, which were processed and summed up anew according to the
definitions of the tables. Therefore the data presented in the table were not
conveyed by the company and there may be discrepancies between the data
of the company and those of the table. The expenses were divided
according to two destinations:
(a) Electricity generation expenses, by which the distribution of
electricity generation inputs (group [minor industry] 400) was
calculated.
(b) Capital formation expenses, by which the distribution of capital
formation inputs in the industry (construction for electricity
distribution – group [minor industry] 411, see Section 4.4, below) was
calculated.
3.2 Water (410)
Water is produced by several different producers, the main one of which is
the Mekorot Company, which supplied about 66% of the total water in
1995. The other producers are local authorities, conurbations, moshavim,
kibbutzim, private companies and others.
The output in the water industry – of all types of factors – is defined as
total expenditure of the producers. The expenditure on capital formation
for developing the water system is calculated in industry 405 –
"construction for water supply."
Sources of Data
The estimates were based on profit-and-loss reports of the Mekorot
Company and the reports of the local authorities and conurbations for
1995. An imputation was made for the other factors.
4. Construction Industry
The Construction industry is divided into 14 groups (minor industries), the main criterion
for division being the destination of the construction, as opposed to the standard
classification of economic activities for 1995, where the criterion is the type of work
(building carpentry, installation of electricity, development works, frame building,
installation of air conditioning system, etc.).
The output value for most construction industries is based on data on capital formation in
buildings and groundwork from data of the National Accounts, plus data on construction
for defence building and estimates for maintenance of buildings.
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The input distribution in non-residential building industries was calculated, due to lack of
specific indices, according to division by weights of types of expenditure within the
building-work items of the Price Index of Residential Building. In addition, the
distribution is based on specific data on the industries themselves and on the weights of
public residential building.
4.1 Residential Building (industries 401, 430)
Residential building is divided into two groups (minor industries):
Public residential building (430), which has been defined as residential
building initiated by the government, national institutions, local authorities
and companies controlled completely by these institutions.
Private residential building (401) includes all residential building other
than public.
Breakdown of Inputs: Estimates of residential building according to
distribution of the output value of the industries are based on Price
Index of Input in Residential Building,1 conducted by the Prices unit of
the CBS. The new basket of construction inputs is measured as of
January 1992. In this stage the index pattern was elaborated
considerably by the preparation of sub-indices system by buildingwork items besides the indices system regarding the whole basket of
residential building. The weights of the inputs by group (minor
industry) for 1992 were revised for 1995 according to the relative
change of prices in each industry.
4.2 Construction for Agriculture (402)
The main construction done in this industry is greenhouses, chicken coops,
brooders, cowsheds and other structures. Output data are based on the data
of the National Accounts.
The capital formation in land development, plantations and forestry are
included in the output of the agriculture industry and the capital formation
in the inner irrigation network are included in the construction output for
water supply.
4.3 Construction for Water Supply (405)
The main works included in this industry are: development of the water
network, inner irrigation network and drainage works.
4.4 Construction for Electricity Distribution (411)
These works include works implemented by the Israel Electric Company
directly and by external contractors.
4.5 Building for Manufacturing (409)
The works include capital formation in regular and chemical manufacturing
structures and in mining and quarrying.
1
CBS. Technical Publication No. 66. Jerusalem, 1995.
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4.6 Buildings for Public and Business Services (413)
The output of the industry includes building of health institutions,
education and sport institutions, cultural and other public institutions, such
as government offices, local authorities, the Jewish Agency, buildings for
commerce and offices for different purposes.
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4.7 Road Construction (414)
Besides the construction of roads (including the construction of roads that
connect Jewish settlements in Judea and Samaria and in the Gaza Area)
this industry also includes maintenance of roads. Inputs were detailed
according to weights used in updating the price index of inputs in road
construction, based on Update of Index of Input Prices in Road
Construction – January 1996.1 The value of capital formation in road
construction and maintenance was obtained from the National Accounts.
4.8 Construction for Telecommunications (415)
This industry includes buildings for telephone exchanges, cable laying
(including the value of the cables), expansion of existing networks, works
for the IDF and post offices. The value of capital formation in road
construction and maintenance was obtained from the National Accounts.
4.9 Additional Construction for Transportation and Other Construction Works
(416)
This industry includes all types of construction for the transport industries
(ports, railways, airports, storage, petroleum services, etc.) and all types of
construction for defence buildings.
4.10 Building Maintenance (457)
The output of this industry is a sum of the expenditures of all industries of
the economy on building maintenance and renovations.
The classification of output by kinds of works (as carpentry, painting,
sanitary plumbing, electricity, installation of air conditioning systems) was
based on estimates and on previous Input-Output Tables. The breakdown
of inputs in each kind of work was based on weights of the building-work
items in the price index of residential building inputs.
4.11 Assembly of Equipment (470)
This industry includes the assembling of equipment of all industries of the
economy.
5. Transport Industry
The classification of transport industries in the Input-Output Tables usually parallels the
Standard Industrial Classification of All Economic Activities 1993,2 except for:
– The groups (minor industries): air transport agencies, shipping agencies,
travel and tourist agencies, custom clearing agencies and transport services
n.e.c., which were united to one industry (632).
– The groups (minor industries): storage, parking lots and land transport n.e.c.,
which were united to one industry (640).
1
2
CBS. "Current Briefings in Statistics" No. 5/1996. Jerusalem, 1996.
CBS. Technical Publication No. 63. Jerusalem, 1993.
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5.1 Sources of Data
The estimates of output, inputs, labour compensation and other value added
of the following industries were calculated according to Trade, Services,
Transport and Communication Survey – 1995.1 The source of the survey
data was the dealers' profit-and-loss reports submitted to the income tax
authority.
(a)
(b)
(c)
(d)
(e)
(f)
(g)
(h)
(i)
Buses (600)
Truck services(602)
Rail services (603)
Water transport (610)
Port services (631)
Transport of freight and passengers by air (620)
Airport services (631)
Post and courier activities (650-651)
Telecommunications (660-661)
5.2 Taxis (601)
Output estimates were conducted in this industry based on main indicators,
such as number of taxis, kilometres travelled and price per kilometre.
5.3 Trucks (602)
In the previous Input-Output Tables, the trucks industry included both paid
truck services and own-account trucks of firms and establishments. In the
current tables according to new international recommendations, the
industry includes only the paid truck services. Unpaid services are included
in the industry in which the transport was carried out, for example,
manufacturing or trade industries. Therefore the direct coefficients of this
industry in the current tables are not comparable to those of the previous
ones.
5.4 Transport Margin
This component is the expenses of transporting goods from the seller to the
purchaser, which are not included in the value of the purchase or the sale of
the goods, but in data in a separate row since the Input-Output Tables are
conducted in basic prices. Each cell in this row is a sum of the transport
expenses paid by the purchaser (according to the record in the column) for
the transport of goods (from import and domestic production) from the
seller to him. (For imported goods only the expenses of land transport in
Israel are included.)
5.4.1 Transport-by-Trucks Margin
The percentages of transport in each industry of origin
were taken from Survey of Trucks – 19902 and were
adjusted to the total output of the trucks industry as
1
2
CBS. "Current Statistics" No. 14/1999. Jerusalem, 1999.
CBS. Special Series – No. 924. Jerusalem, 1993.
- (44) -
obtained from the Trade, Services, Transport and
Communication Survey – 1995.1
Throughout the balancing of resources and uses the
output of the industry transport by trucks was increased
on account of records for self-employed persons whose
main activity was difficult to define according to
profit-and-loss reports. At first they were classified in
the trade industry and after a further examination they
were defined as paid transport.
The distinction between transport of imported goods
and domestic ones was made according to the
proportion of imports in total resources in each
industry of origin.
5.4.2 Railroad Transport Margin
The data necessary for estimating the railroad transport
margin were obtained from the Israel Railway.
According to the description of goods a distinction was
made between the transport of imported and exported
freight.
5.4.3 Port Expenses Margin
This includes all fees of the Port Authority, such as
wharfage, porterage and storage of imports. Data were
obtained on port expenses from records of mortar
imports and exports by type of goods such as grain,
chemicals, cement, coal, and phosphates. The other
ports expenses were distributed among the industries
of origin relative to the value of exports and imports.
6. Trade Industry
The output in this industry is defined as the difference between the value of sales of
goods owned by the business and the value of purchases of goods intended for sale (after
the deduction of change in inventories) in addition to fees received for sold goods other
than those owned by the business. The output also includes income from other activities
and excludes income from interest, linkage and rate differences.
In the current Input-Output Tables, as in the tables for previous years the main trade
industries – wholesale trade (50) and retail trade (51-56) according to the standard
classification of industries were not subdivided and they are presented as one industry
(500) according to the Input-Output classification in the 232-industry aggregation.
The data used as a basis for the outputs and inputs estimates of the trade industries were
taken from Trade, Services, Transport and Communication Survey – 1995.1 The source
of the survey data was the dealers' profit-and-loss reports submitted to the income tax
authorities.
1
CBS "Current Statistics" No. 14/1999. Jerusalem, 1999.
- (45) -
6.1 Marketing Margin
In the Input-Output Tables transactions are recorded at basic prices and are
presented as a direct purchase of some of the industries from other ones
whether for intermediate or final use. Actually, a large part of transactions
take place via trade industries. In Input-Output Tables the purchases from
trade industries are confined to marketing margin industries (see definition
of industry's output, above). The trade data row in Input-Output Tables
includes the marketing margin of purchase of goods from import and from
domestic production.
There are differential market margins for different destinations. Usually,
the marketing margin of consumption products is higher than the one of
products for intermediate uses. The marketing margin of imported products
was calculated only for the indirect imports – by merchants and not by
producers. These imports included goods for final consumption or capital
formation and inputs imported by merchants.
The marketing margins of goods produced by the agriculture and
manufacturing industries were determined separately for each industry of
origin and destination.
As for agricultural consumption products, the marketing margin derived
from the prices obtained by producers, basic prices, compared to purchaser
prices out of the breakdown of the consumer price index.
Data of Trade, Services, Transport and Communication Survey – 19951
served to determine percentages of the marketing margin for some of the
manufacturing produce designated for consumption, capital formation and
intermediate uses. For consumption of industrial food goods the marketing
margin derives from a comparison between purchaser prices of goods
(according to the consumer price index) and wholesale prices (according to
wholesale price index).
During the balancing of resources and services the output of the trade
industry decreases on account of activity of self-employed persons for
whom it was difficult to determine the main activity according to the
profit-and-loss reports. At first they were classified in the trade industry
and after a further examination they were defined as paid transport.
7. Services Industry
The services industry was divided into 25 commercial groups (minor industries), eight
industries of non-profit (private and public) institutions' services and five public services
industries. The estimates of inputs and outputs of commercial services industries
(excluding banking and insurance, as well as accommodation services) are based on
Trade, Services, Transport and Communication Survey – 1995.1
The inputs and outputs estimates of banking and insurance as well as accommodation
services were conducted based on concentrated data collected regularly by the CBS.
1
CBS. "Current Statistics" No. 14/1999. Jerusalem, 1999.
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The estimates for services given by non-profit institutions and public institutions were
carried out on the basis of data collected by the National Accounts and detailed reports of
the institutions, the Accountant General, the local authorities, the national institutions and
the non-profit institutions.
7.1 Services Provided on a Commercial Basis
This industry includes 25 groups (minor industries) compared with ten
industries in the previous publication. The new industries include:
services of lawyers and notaries, bookkeeping, rental of machinery and
equipment, recruit and provision of personnel, guard and cleaning
services, business counselling, architectural and engineering services,
advertising services, etc. Similarly the new industry ownership of
dwellings (see below) is included. In most industries the estimates
were based on a survey conducted especially for the tables of 1995:
Trade, Services, Transport and Communication Survey – 1995.1 This
sample was taken from the one used for deriving the data of Dealers
and Revenue of Economic Industries according to Value Added Tax –
1995-1997.1 The population of active dealers whose data were
obtained from the VAT files includes authorized dealers, partnerships
for VAT purposes (file consolidation), small dealers and selfemployed persons. The survey included about 4,100 companies, which
constitute nearly 2% of the investigated population and 48% of the
total revenue in the survey. For obtaining detailed data on the
industries and the way of calculating the estimates, see the survey
above.
7.1.1 Restaurants and Dining Services
According to the Input-Output definitions the dining
services output does not include expenses on food
included in the private consumption data.
7.1.2 Accommodation Services
The estimates are based on survey of hotels conducted
by the CBS and the ministry of Tourism: Hotels –
income, Expenditure and Product – 1995,2 regarding
hotels approved or not yet approved by the Ministry of
Tourism together with imputation for youth and other
hostels, field schools, rural accommodation and other
hotels. As in restaurants and dining services the output
of accommodation services does not include expenses
on food that were already included in the private
consumption of households.
7.1.3 Banking Services (part of industry 67)
1
2
CBS. "Current Briefings in Statistics" No. 30/1998. Jerusalem, 1998.
CBS. Publication No. 1087. Jerusalem, 1998.
- (47) -
The data on the output of commercial banks, mortgage banks
and banks for financing of investment are based on data of the
Bank of Israel.1
7.1.4 Insurance and Social Insurance Funds Services (part of industry 68)
The data on insurance companies are based on annual
data published in the Statistical Abstract of Israel2 and
further details received from the supervisor of
insurance in the Ministry of Finance.
The data on social insurance funds were based on the
CBS' publication Social Insurance Funds – 1995.3 As
for labour compensation and number of employees, an
estimate was conducted based on data of the National
Insurance Institute.
7.1.5 Ownership of Dwellings
See Chapter B, Section 5.5.
7.2 Services of Non-profit Institutions (863-908)
Non-profit institutions are institutions that provide welfare, religious,
health and educational services to households whether or not they are
financed by the general government sector. Anyway, they do not
operate on a commercial basis. These institutions include, inter alia,
the different sick funds, hospitals, universities, the Technion, and
various institutions like the Organization of Working Mothers.
These services are not provided at purchaser prices, but either free or
at prices covering partially their cost. Therefore, it is impossible to
measure them according to payments of the households for their
purchase. These services are measured according to current expenses
of institutions on goods and services defined as the consumption of the
organizations.
The non-profit institutions are classified in the Input-Output Tables
into private and general government according to the definitions in the
System of National Accounts and by the financing percentages.
General government non-profit institutions include institutions that are
mainly financed by the government, i.e., universities, sick funds and
political parties. The other institutions are included under private. This
classification is identical to that used in the System of National
Accounts .
1
2
3
Bank of Israel, Supervisor of Banks. Annual Information on the Banking Corporations – 19911995. Jerusalem, 1996.
CBS. Statistical Abstract of Israel – 1997, No. 48. Chapter 19: "Banking and Insurance."
Jerusalem, 1996.
CBS. "Current Briefings in Statistics" No. 38/1997, Jerusalem, 1997.
- (48) -
As mentioned above the services provided by the non-profit
institutions were defined as a part of the producing industries of the
economy.
In the 232-industry aggregation they were listed as eight industries:
(a) Health services of general government non-profit institutions
(898)
(b) Health services of private non-profit institutions (897)
(c) Educational services
institutions (899)
of
general
government
non-profit
(d) Educational services of private non-profit institutions (896)
(e) Welfare services of general government non-profit institutions
(894)
(f) Welfare services of private non-profit institutions (863)
(g) Other services of general government non-profit institutions (908)
(h) Other services of private non-profit institutions (895)
The output of these institutions was measured according to their
expenses: labour compensation, taxes on wages, VAT and employers
tax, and current purchases of goods and services. The output includes
neither expenses on interest and linkage differences nor expenses on
food included in the private consumption of households.
It should be noted that output includes imputation for depreciation and
expenditure on medicines. In the data of the National Accounts
expenditure on medicines is included in the private consumption of
households.
7.3 General Government Services
In the detailed 232-industry aggregation the general government sector
is divided into five industries:
(a)
(b)
(c)
(d)
(e)
General government welfare services (865)
General government health services (901)
General government education services (902)
Other general government services (903)
Defence (903)
In the Input-Output Tables this industry includes the various
ministries, the National Insurance Institute, the national institutions
(expenditure in Israel by the Jewish Agency, the Zionist
Confederation, HaKeren HaKayyemet and Keren HaYesod) and local
authorities. The commercial establishments of the government, such as
the post, airports, the ports and railway authority, and of the local
authorities, are not included in the general government sector, but in
the different industries. Similarly, the general government sector does
not include the internal establishments of the government such as the
Government Printing Office (which is included in the manufacturing
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industry) and the Public Works Department (included in the
construction industry); this is according to the System of National
Accounts.
In the standard classification of industries the Israel Broadcasting
Authority belongs to the personal services industry, and is thus
classified in the Input-Output Tables.
The output of the general government services was measured
according to labour compensation plus imputation for budget pension,
purchases of goods and services and depreciation.
7.3.1 Classification of Expenditures by Industry of Origin
7.3.1.2 Expenditures of the Government, National
Institutions and the National Insurance Institute
The analysis of expenditures of the general government
incorporated an economic classification of the reports
of the government, the national institutions and the
National Insurance Institute by type of expenditure
such as labour compensation, current purchases, sales,
transfers and capital formation in building and
equipment.
Labour compensation: The definitions are identical to
those used in the System of National Accounts.
Current purchases: To make a breakdown of the
inputs (excluding labour compensation) it was
necessary to classify all the purchases appearing in the
reports of the institutions above according to an
industry of origin. Towards the preparation of the
current tables special reports were obtained from the
government and the institutions with breakdown of
purchases by suppliers. In order to classify the
suppliers, their records were paralleled to the business
framework of the CBS. In addition clarifications were
done in the ministries and the institutions.
7.3.1.3 Expenditures of Local Authorities
Local authorities' reports are arranged by main
expenditure in economic departments, such as repairs,
cleaning, various materials, fuel and electricity.
General items were displayed by reports of several
municipalities that were more detailed than the general
summary. The labour compensation data were obtained
from the National Accounts, which include imputation
for municipal services of kibbutzim, moshavim and
religious councils. The auxiliary services of local
authorities were defined as a part of the authorities'
services and not as a part of an internal establishment.
Therefore expenditure on labour compensation in this
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area was calculated according to an estimate based on
detailed data obtained from several municipalities.
7.3.1.4 Defence Consumption
Data on defence consumption were obtained from the
National Accounts. For the classification of purchases
by industry of origin, the Ministry of Defence provided
values of purchases from domestic production, by
suppliers. The suppliers were classified by industry in
accordance with the Input-Output classification.
7.3.1.5 The Depreciation in General Government
Institutions
This was assessed using the estimate of the National
Accounts.
8. Imports
In the 1995 Input-Output Tables as in the previous tables, the imports were recorded in
two versions: version A, in which the total imports is divided into competitive and
complementary imports, and version B, where the total imports – goods and services – is
presented on a separate row under primary inputs. Competitive imports are goods and
services defined as competing with corresponding goods produced in Israel; they are
added to domestic production and appear in quadrant I of the matrix. Complementary
imports are goods and services that are not produced in Israel and appear on a separate
row under primary inputs.
Three matrices1 were prepared for the tables of 1995: total imports,
complementary imports and competitive imports.
8.1 Import of Goods
Customs is the source of data that lists imports by customs items. The data
obtained were the import C.I.F. value of each of the goods (including
insurance and transport by foreign and Israeli ships and airplanes) and the
value of customs duty, and other taxes paid for each of the goods.
First the goods, about 8,500-9,000, were classified by characteristic
industry of origin abroad and by destination: private consumption of
households, capital formation or inputs.
In addition, to make an imports matrix for 1995 the importers whose
records were paralleled to the business file of the CBS were classified. Of
the total 64,530 importers paralleling by industry was done to nearly
42,000, whose imports value was higher than $ 250 thousand, and who
consist above 90% of the total import of goods to determine the industry of
destination of goods used as inputs. A considerable proportion of imports
1
The import matrix presents import transactions of the domestic market (Table 6: "Total Imports –
C.I.F."). In this matrix the rows present the sales of the industries abroad, and the columns – the
domestic industries and final uses. This matrix enables a calculation of the direct coefficients of
imports (Table 7) and the total coefficients of imports (Table 8).
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arrived through merchants who are also included among the 42,000
importers mentioned above. In 1988 Imports Destinations Survey – 19881
was conducted. The survey intended to classify the imported goods by
industry of destination and to estimate thus the component of imports in
industrial inputs by industry of origin. In 1995 this survey was not
conducted. In each industry of origin the imported goods were classified to
the different destinations according to the data from the survey of 1988.
According to information from manufacturing industries obtained from
Survey of Products and Materials in Manufacturing – 19952 the value of
imported inputs that should be classified to the different destinations was
about 30% of the total imported goods, not including fuel, diamonds and
vehicles. This sum does not include goods imported by merchants and
intended entirely for final consumption or capital formation.
8.1.1 Classification of Imported Goods – Complementary and
Competitive Goods
The distinction between competitive and complementary imports was
done after comparing the value of imported goods to the value of
domestic industrial produce by the data of Survey of Products and
Materials in Manufacturing – 19951 and to the data of domestic
agricultural produce – by products.
First the domestic goods were classified at a level of eight digits in
cases where the highest adjustment could be obtained, and in other
cases – at a level of four digits.
In the second stage the data on imported goods were adjusted to the
domestic production at a level of eight or four digits, according to the
specific case.
In all cases the domestic production percentage was calculated of the
total resources.
In cases where the domestic production percentage of the total
resources was higher than 20%, the imported goods were classified
as competitive imports. In other cases it was classified as
complementary. In certain cases the export of domestic goods was
examined as well. If the export rate of the goods was considerable the
correspondent imported goods were classified as competitive. As in
previous years clarifications were made in the Ministry of Industry
and Trade regarding the fields of chemistry, metal, textiles, etc.
8.1.2 Adjustment to Data of Import of Goods
During the preparation of Balance of Payments data
adjustments were made to the data of imported goods:
(a)Imports from Judea and Samaria and the Gaza Area
was added. Due to difficulties in measuring the
1
2
CBS. "Special Series" – No. 952. Jerusalem, 1993.
CBS. Publication No. 1123. Jerusalem, 1999.
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division of imports by industries of origin was done
based on rough assessments.
(b) Returned imports were deducted by goods. The
classification by industry of origin and by
destination was based on the description of the
goods.
(c) Consignments for tourists and diplomats: Data on
import of goods included the import by diplomats
and tourists who are not permanent residents of
Israel and their transaction with factors abroad are
not included in the Balance of Payments; therefore
an adjustment was made to deduct these goods
from the imports for private consumption of
households.
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8.1.3 Imports adjustments – F.O.B./C.I.F.: In accordance with the guidelines of
SNA – 1993, imports should be recorded at F.O.B. values just as exports are.
Thus, imports should include the costs of transport and insurance in foreign
companies, but not the costs of these services by Israeli companies. Since the
value of the imported goods is listed in the customs records at C.I.F., and since
it is impossible to deduct the value of transport and insurance services for Israeli
companies from each of the goods, an overall adjustment is made in the tables
for water transport, air transport and insurance in order to convert C.I.F. prices
to F.O.B. values.
8.2 Import of Services
8.2.1 The source of data is the Balance of Payments system. To
determine the industry of origin and the industry of destination
of items of imported of services from abroad the maximally
detailed breakdown of items of working sheets of the Balance of
Payments system was obtained.
8.2.2 Adjustments to Balance of Payments Data
(a) Import of services in the Input-Output Tables does
not include payments to production factors abroad
– wages and other value added, such as interest and
dividends paid abroad. Wages paid abroad (mainly
to workers from Judea and Samaria and the Gaza
Area and to foreign crews) were included in labour
compensation whereas other payments of other
value added made abroad are included in "other
value added," which was derived as the difference
between output values and the total inputs.
(b) Imports do not include payments of interest by the
general government to factors abroad as in the
System of National Accounts, which defines these
payments as transfers.
(c) The Balance of Payments data on import of
services do not include commissions and discounts
paid by the exporters to agents abroad. This value
was calculated from the sum of exports entries. It
was decided to deduct these sums from the data on
imports as well as from the data on exports (which
include commissions and discounts) of the Foreign
Trade unit of the CBS. Thus these sums were
adjusted to the data on exports reported in the
Manufacturing and Crafts Surveys, which do not
include commissions and discounts.
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CHAPTER E. FINAL USES
Final uses were classified in the current publication as follows:
Final Consumption Expenditure
– Private consumption of households
– Private consumption of non-profit institutions serving households
– Collective general government consumption
– Individual general government consumption
Gross Capital Formation
– Fixed capital formation: buildings and groundworks
– Machinery and equipment from import and domestic production
– Change in inventories of finished products and work in progress
Exports
– Export of goods and services, including export to Judea and Samaria and the Gaza
Area
– Consumption by non-residents
1. Private Consumption of Households and of Non-profit Institutions
Serving Households
The main sources for preparing estimates of private consumption were:
(a) Data on total private consumption according to the data of the National Accounts;
(b) Data on imported goods classified as intended for final consumption of households.
The estimates of the National Accounts are obtained at purchaser prices. The
transition from purchaser prices to basic prices was done by deducting
marketing and transport margins from imports as well as domestic production
data.
1.1 Balancing of Resources and Uses
At this stage some revisions were made in the final expenditure of
households. Some of them were classification revisions, and the others
– of excess or deficient covering.
1.2 Consumption of Housing Services
In the previous publication all the housing services (imputed and
rental) were recorded as a direct product of the private consumption –
in quadrant IV of the table. According to international guidelines a
new industry was recorded in the table for 1995 – "ownership of
dwelling" – see Chapter B, Section 5.5.
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1.3 Adjustment of the National Accounts Data to the Input-Output Tables
The estimates obtained from the National Accounts on the final
consumption of households include the consumption of non-residents,
which is defined as travels abroad, consumption of foreign consulates in
Israel, and the consumption of residents of Judea and Samaria and the Gaza
Area in Israel. This consumption was deducted by industry.
Following are the adjustments conducted.
(a) Deduction of Consumption of Non-residents
Consumption of non-residents was classified by industry of origin according to
the details presented in Section 4.2 in this chapter. Food consumption by nonresidents was allocated proportionately among the food industries according to
the share of each industry in total private consumption of domestically produced
food. Consumption by non-residents allocated to industry of origin, was
deducted from final consumption of households and added to export of services.
(b) Addition to the Accommodation Services Industry (540)
The estimate of final consumption of households should also include the
consumption of Israelis abroad, consumption by seamen and pilots and
consumption of Israeli consuls abroad. Since it is impossible to classify these
into industries of origin, they were arbitrarily classified in this publication, as in
the previous ones, in the accommodation services industry (540). The estimate
of consumption of Israelis abroad was obtained from the CBS' Balance of
Payments system.
(c) Purchases by Households (Final Consumption) from Private and General
Government Non-profit Institutions and from the General Government
Sector are payments of households to non-profit institutions or to the general
government sector on account of various services, including symbolic payments
that do not cover the cost of the services. As in tables for previous years the
current tables do not specify the consumption of non-profit institutions. Instead,
services produced for own use by private non-profit institutions (output less
sales) are included in the final consumption of non-profit institutions serving
households; services produced for own use by general government non-profit
institutions are included in individual general government consumption.
2. General Government Consumption
This consumption, collective as well as individual, includes services produced for own
use by the general government sector and by general government non-profit institutions,
as well as the defence consumption.
The general government consumption includes the expenditure on labour compensation
(including taxes), current purchases of goods and services and imputation for
depreciation. The consumption is net from sales of products sold at prices lower than cost
and at cost prices.
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3. Capital Formation
The components of this item:
– Fixed capital formation, which includes capital formation in building and
construction works and in domestically produced and imported machinery and
equipment;
– Capital formation in inventories of finished products and in work in progress;
– Capital formation in inventories of materials.
3.1 Capital Formation in Buildings
The data are based on the National Accounts estimates and adjusted to
Input-Output Tables (see Chapter D, Section 4).
3.2 Capital Formation in Machinery and Equipment
(a) Domestic production: The figures are based on estimates of the National
Accounts. The estimates include the value of production of machinery and
equipment as estimated from a current survey conducted by the National
Accounts unit of the CBS, after deducting the value of equipment designed for
export and defence.
(b) Imports: The figures were derived from the records of imported goods, which
are intended partially or entirely for capital formation.
3.3 Capital Formation in Inventories of Finished Products and in Work in Progress
Capital formation in inventories is defined as the difference between
the inventories at the beginning and at the end of the year, and it is a
part of the output.
The inventory value is estimated at prices of the middle of the year to
deduct capital profits. The data on inventories received from the
manufacturing establishments are based on the F.I.F.O. (first-in, firstout) system of inventory recording. The inventory data for the
beginning and the end of the year are converted to values of the
middle of the year by specific price indices of the different industries.
3.4 Capital Formation in Inventories of Production Materials
Capital formation in inventories of materials is presented as part of the
final uses. Intermediate uses include data on consumption of materials.
The distribution by industry of origin was done according to the same
proportions in the data on purchase of materials in Manufacturing and
Crafts Surveys – 1995.1
1
CBS. Publication No. 1091. Jerusalem, 1998.
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4. Exports
The components of exports are the following:
– Export of goods
– Export of services
– Consumption of non-residents
– Export to Judea and Samaria and the Gaza Area
4.1 Export of Goods
The data on this were obtained from the summary of the exports entries,
which serves as the basis for all current statistics on Foreign Trade. The
data were obtained at F.O.B. values, and arranged by industry of origin.
Hereby are the adjustments to exports data.
(a) Discounts and Commissions to Agents
The Foreign Trade data include discounts and commissions to agents abroad.
These were deducted from the value of exports according to the total value of
discounts and commissions recorded in the Balance of Payments. Thus the sum
of exports was adjusted to the data reported in the manufacturing survey, which
appear after deduction of commissions and discounts.
(b) Export of Used Ships, Scrap Metal, Waste and Antiques
The value of the goods above was deducted from total value of exports
appearing in the tables, as they were not products of the domestic industries.
(c) Returned Exports
The net value of returned exports were deducted from exports data. Most of this
item refers to returned diamonds.
4.2 Export of Services Abroad
These data were provided from the detailed work sheets of the Balance of
Payments system, but the breakdown was not detailed enough to enable
classification by industry of origin. Use was done of data from V.A.T. files
(value of goods exempt from tax). A large part of the services that were not
specified were classified in software export, and the rest – in the
commercial services industries, real estates and garages services, etc.
4.3 Consumption of Non-residents
This item includes the consumption of tourists in Israel, the
expenditure of foreign consulates, and the consumption of foreign
workers, without the consumption of the residents of Judea and
Samaria and the Gaza Area, which is measured separately (see below).
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The distribution by industry of origin was based on Tourists' Survey –
March 1995 – February 1996: Final Report.1 This survey includes
data on tourists' expenditures in Israel by type of expenditure.
4.4 Export of Goods and Services to Judea and Samaria and the Gaza Area
Data were based on rough estimates and on partial data, which are not
sufficiently reliable.
1
Ministry of Tourism. Jerusalem, 1996.
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