August 8, 2011
This is an information notice.
Statistics Canada will introduce a new classification structure to organize and present import and export statistics in various programs. The new structure will replace the classification structures known as the summary import groups (SIG) and the summary export groups (SEG) that have been in use for several decades.
The new structure builds a bridge between the Canadian Export Classification (CEC), Customs Tariff (CT) and the Input-output commodity classification (IOCC). The main objectives of the new system are to better integrate import and export statistics in the System of National Accounts and update the presentation of import and export statistics.
The links below provide a description of the current practices regarding the classification of goods in the Canadian statistical system, of the new aggregation structure, of the advantages and limitations of the new system and, the implementation schedule.
- The current situation
- The new classification system
- The nomenclature
- The advantages and limitations of the new system
- Implementation schedule
The reader should note that the introduction of this aggregation structure is only a first step towards improved harmonization of commodity statistics. It launches a new approach that will be fully implemented in the 2012 Canadian version of the North American Product Classification System (NAPCS). The link below leads to more information on that project.
The current situation
Statistics on goods are based on several classification systems. In the domain of statistics on the supply and use of goods, some of the key classifications are the Annual Survey of Manufactures (ASM) - List of Goods, the Canadian Export Classification (CEC) and the Customs Tariff (CT). There is no standard system or aggregation structure integrating these classifications. The new system seeks to fill this gap.
In the Canadian statistical system, the input-output accounts integrate product statistics into a coherent system that describes the supply and use of goods, services and production factors in our economy. This framework underlies the new classification system.
The new classification system
The new aggregation structure for import and export statistics is a component of a new system of commodity classifications.
The new system has two elements, a standard classification structure and alternative aggregation structures or variants of the standard classification. At this time, only one variant has been developed to serve the needs of the merchandise import and export accounts, but the system is designed to accommodate as many as necessary.
The link below presents the first two levels of the standard classification structure.
At its most detailed level (five-digit class), there are 264 classes of goods. This level of the classification will be the basis for the commodity dimension of the input output tables with some minor differences to address data limitations. That said, this will be the most detailed level for which statistics on domestic production, imports and exports of goods will be harmonized.
The 264 detailed classes of the standard classification structure are then organized into 88 three-digit groups designed to publish selected statistics and used to define the higher level categories of variants.
Though not shown here, the standard classification embeds additional levels that integrate more detailed categories used in other parts of the statistical system. For instance, the five-digit classes of the standard classification have been defined in most cases on the basis of the Annual Survey of Manufactures (ASM) - List of Goods, a classification that has been in use for several years. The ASM list of goods is consequently well integrated into the new system.
As well, Statistics Canada is developing new goods classes for the measurement of producer prices, largely based on the Annual Survey of Manufactures (ASM) - List of Goods. The producer price classes will appear below the five-digit classes of the standard classification and above the ASM classes in the classification hierarchy, thereby enhancing the comparability of production and producer price statistics.
The relationship between the 264 five-digit classes of the standard classification and those of the Canadian Export Classification (CEC) and the Customs Tariff (CT) is defined by concordances. Each of the most detailed categories of those classifications will be assigned to one of the five-digit classes of the standard classification. This approach allows for the presentation of import and exports statistics on the basis of two distinct systems; on the basis of Harmonized System and derived Canadian versions (the CEC and CT) as required by law; and on the basis the new classification system presented here.
As mentioned earlier, only one high level alternative aggregation structure or variant has been developed so far. It will replace the summary import groups and summary export groups that have been in use for several decades. The link below leads to the new aggregation structure for import and export statistics.
Though there is only one high-level aggregation structure at this time, the system is designed to add variants to serve other analytical needs. All variants will share two common features:
- The aggregates will be defined in terms of the 3-digit categories of the standard classification;
- The standard classification elements used to define these aggregates will retain the standard classification code.
The reader will note the alphanumeric codes of the two top levels of the variant for merchandise import and export accounts (codes beginning with the letter C) and the numeric codes of the two lower levels of the structure (those of the standard classification elements used to define the aggregates). This coding approach will be retained if additional variants are developed. The variants will be recognizable by the alpha numeric coding at the first two levels of the structure.
The nomenclature
The aggregation structure presented above has four levels named section, division, group and class.
| Level | Name | Number of digits | Number of categories |
|---|---|---|---|
| 1 | Section | 3-digit alpha numeric | 11 |
| 2 | Division | 4-digit alpha numeric | 33 |
| 3 | Group | 3-digit numeric | 88 |
| 4 | Class | 5-digit numeric | 264 |
The details below the class level (not shown here) will be known as NAPCS subclass and NAPCS detail when NAPCS Canada 2012 is introduced.
The advantages and limitations of the new system
The new system has the following advantages:
- Promotes better integration of statistics on goods;
- Promotes the publication of more coherent data on goods;
- Facilitates data interpretation for users;
- Facilitates the harmonization of the classification revision cycle for all programs that use the classification system.
The new system also has limits.
The most important is that its implementation depends on the integration of classifications that were developed independently from one another and do not always use the same criteria to distinguish products - the Annual Survey of Manufactures (ASM) - List of Goods, the Canadian Export Classification (CEC) and the Customs Tariff (CT). As a consequence, the concordances between the CEC and the standard classes and between the CT and the standard classes are less than perfect. This limitation cannot be entirely eliminated since the use of the CEC and CT is prescribed by administrative agreements and legal obligations.
However, the new system makes it possible to eliminate several inconsistencies between the basic classifications at the more aggregated levels.
Finally, it is important to note that the system presented here is not complete since it covers neither services, nor tangible or intangible assets. These components will be added in NAPCS Canada 2012.
Implementation schedule
The main users within Statistics Canada are planning to adopt the new classification system in 2012. The following table shows the plan for each program. The scope of the historical revision by each program remains to be determined.
| Statistical program | Variables | First release and reference period |
|---|---|---|
| International merchandise trade | Merchandise imports and exports (current dollars, constant dollars and related price indexes). | June 2012 for April 2012 data (based on the tariff standard and the Balance of Payments standard). |
| Balance of payments | Merchandise imports and exports in current dollars. | May 2012 for the data for the first quarter of 2012 and every previous quarter since the first quarter of 1981. |
| Income and expenditure account | Annual and quarterly merchandise imports and exports (current dollars, constant dollars and related price indexes). | May 2012 for data in the first quarter of 2012 and every previous quarter since the first quarter of 1981. |
| Producer price indexes | Producer price indexes. | November 2013 based on the basket for 2007. The reference period remains to be determined. |
The level of detail provided will differ depending on the program and variables. The following table provides the plans for each program with regard to the classification version used and the level of detail available.
| Statistical program | Standard classification | Variant: Merchandise import and export accounts |
|---|---|---|
| International merchandise trade | At the group level (level 3 - 88 categories) in regular publications, and at the class level (level 4 - 264 categories) on request. | At the section level (level 1 - 11 categories) and at the division level (level 2 - 33 categories) in regular publications. |
| Balance of payments | At the section level (level 1 - 11 categories) in regular publications. | |
| Income and expenditure account | At the division level (level 2 - 33 categories) in regular publications. | |
| Producer price indexes | At the group level (level 3 -88 categories) in regular publications and at the class level (level 4 - 264 categories) on request. |
North American Product Classification System (NAPCS) Canada 2012
The introduction of this system is a first step towards broader harmonization of commodity classifications and statistics. In the longer term, Statistics Canada intends to use a similar approach to integrate a variety of commodity classifications, in particular those used to collect value and price data on production, imports and exports of goods, services and intangible assets. This includes the classifications of agricultural, mining, manufacturing, trade and service commodities.
The full implementation of the system will begin with the release of the 2012 Canadian version of the North American Product Classification System (NAPCS) Canada 2012, scheduled for summer of 2012. NAPCS Canada 2012 will:
- Embed significant revisions to the classifications of manufactured, retailed and wholesaled goods as a result of a project to harmonize commodity classifications in North America.
- Provide a means to organize and present commodity statistics on the basis of a coherent system of standard classes, standard variant aggregations and standard concordances.
The implementation schedule of NAPCS Canada 2012 will vary by program. The schedule will be published with the release of the classification.