Measuring Gross Regional
Domestic Product:
The Philippine Experience
by
MARIA FE M. TALENTO
Division Head
Production Accounts Division
National Statistical Coordination Board
International Workshop Regional Products
and Income Accounts
Tiantan Hotel, Beijing China
15 -17 March, 2010
1
Int’l Workshop Regional Products and Income Accounts
Maria Fe M. Talento 15-17 March 2010
Republic of the Philippines
NATIONAL STATISTICAL COORDINATION BOARD
OUTLINE OF PRESENTATION
I.
Introduction
II.
Compilation Process: Gross Regional Domestic
Product (GRDP) of the Philippines
III.
Sources of Data
IV. Estimation Methodology
V.
Development Efforts
VI. Issues on the GRDP
VII. Current Improvements
VIII. Next Steps
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Int’l Workshop Regional Products and Income Accounts
Maria Fe M. Talento 15-17 March 2010
Republic of the Philippines
NATIONAL STATISTICAL COORDINATION BOARD
I. INTRODUCTION
 The Philippine Statistical System (PSS)
 A highly decentralized statistical system:
- statistics are produced by a number of major
producers of primary data and by smaller units
in all levels of government which generates
statistics as a by-product of their administrative
or regulatory functions
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Int’l Workshop Regional Products and Income Accounts
Maria Fe M. Talento 15-17 March 2010
Republic of the Philippines
NATIONAL STATISTICAL COORDINATION BOARD
I. INTRODUCTION
 The Current Gross Regional Domestic
Product (GRDP)
 follows the 1968 UNSNA but to a limited
extent
already
incorporates
the
recommendations of the 1993 SNA.
 a Designated Statistics under Executive
Order No. 352 and is currently being
developed and maintained by the
National Statistical Coordination Board
(NSCB)
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Int’l Workshop Regional Products and Income Accounts
Maria Fe M. Talento 15-17 March 2010
Republic of the Philippines
NATIONAL STATISTICAL COORDINATION BOARD
I. INTRODUCTION

Milestones in GRDP estimation:
 1974 – first compilation of the GRDP for the
period 1971-1974
 1978 – GRDP compilation was resumed and
institutionalized
 Data Series of GRDP: 1978-2008

Coverage of GRDP:
 17 regions

Date of Release of GRDP:
 Every first Thursday of August of the current year
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Int’l Workshop Regional Products and Income Accounts
Maria Fe M. Talento 15-17 March 2010
Republic of the Philippines
NATIONAL STATISTICAL COORDINATION BOARD
II. COMPILATION PROCESS
 The current GRDP
industrial origin:
is
compiled
by
1. Agriculture, Fishery and Forestry
a) Agriculture
b) Forestry
2. Industry
a) Mining and Quarrying
b) Manufacturing
c) Construction
d) Electricity and Water
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Int’l Workshop Regional Products and Income Accounts
Maria Fe M. Talento 15-17 March 2010
Republic of the Philippines
NATIONAL STATISTICAL COORDINATION BOARD
II. COMPILATION PROCESS
 The current GRDP
industrial origin:
is
compiled
by
3. Services
a) Wholesale and Retail Trade
b) Transportation, Communication and
Storage (TCS)
c) Finance
d) Ownership of Dwellings and Real
Estate (ODRE)
e) Private Services
f) Government Services
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Int’l Workshop Regional Products and Income Accounts
Maria Fe M. Talento 15-17 March 2010
Republic of the Philippines
NATIONAL STATISTICAL COORDINATION BOARD
II. COMPILATION PROCESS
 GRDP Measurement : uses the production
approach:
- Unduplicated sum of all the goods and
services produced in the regional economy
(by resident producers), valued at producers’
prices
GRDP (P) =  Gross Value Added (GVA)
by industry, by region
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Int’l Workshop Regional Products and Income Accounts
Maria Fe M. Talento 15-17 March 2010
Republic of the Philippines
NATIONAL STATISTICAL COORDINATION BOARD
II. COMPILATION PROCESS
 Top to Bottom Approach:
- National control total by sector is allocated by
region
- data support is stronger at the national level
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Int’l Workshop Regional Products and Income Accounts
Maria Fe M. Talento 15-17 March 2010
Republic of the Philippines
NATIONAL STATISTICAL COORDINATION BOARD
II. COMPILATION PROCESS
 The NSCB is in the process of devolving the
estimation of the GRDP to the NSCB Regional
Offices:
- the NSCB Central Office estimates the GRDP by
sector for all 17 regions using the national level as
control total.
- Simultaneously, the 9 NSCB regional offices come up
with an independent estimate of their region’s GDP
by sector using available data and indicators from
their respective regions
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Int’l Workshop Regional Products and Income Accounts
Maria Fe M. Talento 15-17 March 2010
Republic of the Philippines
NATIONAL STATISTICAL COORDINATION BOARD
II. COMPILATION PROCESS
 Estimates of the Central Office and the NSCB Regions go
through a deliberation process by sector by region
(validation of data, major developments in the region,
etc.)
 The final estimates are reached, in consensus with the
NSCB Regions after incorporating all considerations in the
deliberation process.
 Independent estimates from the regions, however, will not
add up to the national total
 National total by sector is allocated to the Regions using
percentage distribution.
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Int’l Workshop Regional Products and Income Accounts
Maria Fe M. Talento 15-17 March 2010
Republic of the Philippines
NATIONAL STATISTICAL COORDINATION BOARD
III. SOURCES OF DATA
 Census/Survey-based data
- Census of Phil. Business & Industry (CPBI)
- Annual Survey of Phil. Business & Industry (ASPBI)
- Quarterly Survey of Phil Business & Industry
(QSPBI)
 Administrative-based data
 Special Studies
 Indicators
from
Industry
Associations
(i.e.,
Chamber of Mines, Cement Manufacturers Assn. of the
Philippines, etc.)
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Int’l Workshop Regional Products and Income Accounts
Maria Fe M. Talento 15-17 March 2010
Republic of the Philippines
NATIONAL STATISTICAL COORDINATION BOARD
IV. Current Price Estimation: by region
 Indirect Approach: Use of GVARs
GVA = Gross Output * Gross Value Added
Ratio (GVAR)
where:
GVAR = Gross Value Added
Gross Output
 Sectors: Agriculture, Fishery and Forestry, Mining
and Quarrying
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Int’l Workshop Regional Products and Income Accounts
Maria Fe M. Talento 15-17 March 2010
Republic of the Philippines
NATIONAL STATISTICAL COORDINATION BOARD
IV. Current Price Estimation: by region
 Value Extrapolation
GVAt = previous GVA level t-1 * growth rate of
the value of productiont /t-1
Example: Services sectors – value extrapolation
using the trend of gross revenue from the
Quarterly Survey of Phil Business and Industry
(QSPBI)
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Int’l Workshop Regional Products and Income Accounts
Maria Fe M. Talento 15-17 March 2010
Republic of the Philippines
NATIONAL STATISTICAL COORDINATION BOARD
IV. Constant Price Estimation: by region
 Uses the fixed-base year method:
 Single Deflation:
GVAk = GVAt /Deflator
 Quantity Revaluation:
GVAk = (Qtyt * Price at base year)*GVAR
 Volume Extrapolation:
GVAk = GVA level t-1 * 1+ GR rate of
volume or output indicator/t-1
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Int’l Workshop Regional Products and Income Accounts
Maria Fe M. Talento 15-17 March 2010
Republic of the Philippines
NATIONAL STATISTICAL COORDINATION BOARD
V. DEVELOPMENT EFFORTS
 Addressing increasing demand for local
level statistics:
 pilot compilation of the Provincial
Product Accounts for the provinces of
Palawan in 1998 and Guimaras in 2006
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Int’l Workshop Regional Products and Income Accounts
Maria Fe M. Talento 15-17 March 2010
Republic of the Philippines
NATIONAL STATISTICAL COORDINATION BOARD
V. DEVELOPMENT EFFORTS

ADVANCE RELEASE CALENDAR: NSCB has
adopted
a
policy
of
releasing
in
advance the schedule of press releases for
the
national
accounts & its related
accounts including the GRDP

Forging of partnerships with source agencies
- bilateral meetings, Task Forces
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Int’l Workshop Regional Products and Income Accounts
Maria Fe M. Talento 15-17 March 2010
Republic of the Philippines
NATIONAL STATISTICAL COORDINATION BOARD
V. DEVELOPMENT EFFORTS
 Supplementary data from the private sector:
- financial statement of companies
- gross revenue of top food chains
- volume and value of utilities
- Indicators from industry associations
 Incorporated emerging industries such as
the Business Process Outsourcing (BPO) in
GRDP beginning 2003
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Int’l Workshop Regional Products and Income Accounts
Maria Fe M. Talento 15-17 March 2010
Republic of the Philippines
NATIONAL STATISTICAL COORDINATION BOARD
V. DEVELOPMENT EFFORTS
 Use of NSCB website to inform the public:
 Press Releases, Announcements on the GRDP

Technical Notes on the GRDP

Metadata on the GRDP
 Advance Release Calendar on National
Accounts and its Related Accounts
 Regional Fact Sheets
 Response to erroneous GRDP reports from the
media
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Int’l Workshop Regional Products and Income Accounts
Maria Fe M. Talento 15-17 March 2010
Republic of the Philippines
NATIONAL STATISTICAL COORDINATION BOARD
VI. ISSUES
 Data Problems
 Data support at the regional level
 Frequent revision of regional compositions
 Time
lag
of
data
sources
Survey/Census results, Price indices, etc.
 Need to update/improve parameters
Ratios used in estimation i.e., GVAR,
undercoverage ratios
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Int’l Workshop Regional Products and Income Accounts
Maria Fe M. Talento 15-17 March 2010
Republic of the Philippines
NATIONAL STATISTICAL COORDINATION BOARD
VI. ISSUES
 Coverage
 Emerging Industries
 Births and deaths of establishments
 Undercoverage of illegal activities
 Undercoverage of own-account production
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Int’l Workshop Regional Products and Income Accounts
Maria Fe M. Talento 15-17 March 2010
Republic of the Philippines
NATIONAL STATISTICAL COORDINATION BOARD
VI. ISSUES
 Some Measurement Problems
 Regional allocation of output
-Economic
activities
such
as
Fishing,
Transportation and Communication industries
which extend beyond regional boundaries
-Problem of allocating the cost of operations of
the head office for companies with regional
branches
 Regional estimates of the informal sector
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Int’l Workshop Regional Products and Income Accounts
Maria Fe M. Talento 15-17 March 2010
Republic of the Philippines
NATIONAL STATISTICAL COORDINATION BOARD
VI. ISSUES

RESOURCES
 Manpower
- fast turnover of national accounts staff in the
central office
- need for training on National Accounts for NSCB
personnel in the Regions
- need for the NSCB Central Office staff to revive
visits to the regions for validation of estimates
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Int’l Workshop Regional Products and Income Accounts
Maria Fe M. Talento 15-17 March 2010
Republic of the Philippines
NATIONAL STATISTICAL COORDINATION BOARD
VI. ISSUES

RESOURCES
 Software for GRDP Compilation:
-need to upgrade current hardware and
software resources
- need to refine the existing computerized
GRDP compilation
 Financial Resources for statistical activities:
limited budget given to censuses and surveys;
Statistical offices always get low priority in the
allocation of resources
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Int’l Workshop Regional Products and Income Accounts
Maria Fe M. Talento 15-17 March 2010
Republic of the Philippines
NATIONAL STATISTICAL COORDINATION BOARD
VII. CURRENT IMPROVEMENTS
 Over-all Revision/Rebasing of the GRDP
 Revised/rebased 1998-2009 series
 Implementation of 1993 SNA Concepts
 Shift in base year to 2000 & eventually 2006
 Improvement in Data and Methodology
 Refinements in the computerized compilation of the
GRDP
 Date of Release: September 2010
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Int’l Workshop Regional Products and Income Accounts
Maria Fe M. Talento 15-17 March 2010
Republic of the Philippines
NATIONAL STATISTICAL COORDINATION BOARD
VIII. NEXT STEPS
 Compilation
Accounts
of
City/Provincial
Product
 Provision of training to Compilers and Data
Producers
 Policy on Overall Revision/Rebasing of the
GRDP
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Int’l Workshop Regional Products and Income Accounts
Maria Fe M. Talento 15-17 March 2010
Republic of the Philippines
NATIONAL STATISTICAL COORDINATION BOARD
Maraming Salamat Po!
URL: http://www.nscb.gov.ph
e-mail: info@nscb.gov.ph
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Int’l Workshop Regional Products and Income Accounts
Maria Fe M. Talento 15-17 March 2010
Republic of the Philippines
NATIONAL STATISTICAL COORDINATION BOARD