Changes in Definitions, Classifications, and Methodologies in the U.S. International Transactions Accounts (ITAs)
On June 14, 2013, the U.S. Bureau of Economic Analysis (BEA) released "U.S. International Transactions, First Quarter 2013.” This release includes preliminary statistics for the first quarter of 2013 and revised statistics for the first quarter of 1999 through the fourth quarter of 2012.1 The July 2013 issue of the Survey of Current Business will contain tables and an article describing the revised ITA statistics reflecting newly available source data, as well as several changes in definitions, classifications, and estimation methodologies. Most of the changes result from a multiyear effort to modernize and enhance BEA's international economic accounts to align the accounts more closely with international guidelines. The most recent article describing this effort is published in the May 2013 issue of the Survey of Current Business. Changes in definitions, classifications, and estimation methodologies that were made this June are summarized below and are described in more detail in the May article. The format of the U.S. international transactions tables is unchanged.
- Reclassification of certain military-related exports between services and goods beginning with statistics for 2007. BEA has refined its method for classifying exports under the U.S. Foreign Military Sales program using item-specific information included in the source data provided by the U.S. Department of Defense. As a result, certain exports of goods that were previously recorded under services as part of “transfers under U.S. military agency sales contracts” (ITA table 1, line 5) have been reclassified as exports of goods (ITA table 1, line 3). Certain exports of services that were previously recorded as exports of goods have been reclassified as “transfers under U.S. military agency sales contracts.”
- Reclassification of certain imports of military-related goods from services to goods beginning with statistics for 1999. Purchases of major equipment and non-petroleum goods abroad by the U.S. military, which were previously recorded under services as part of “direct defense expenditures” (ITA table 1, line 22), have been reclassified as imports of goods (ITA table 1, line 20).
- Elimination of a balance of payments adjustment for imports of military goods beginning with statistics for 1999. A negative adjustment (part of ITA Table 2, line A15) that was previously used to deduct imports of military goods from data on a Census basis to avoid duplicating imports reported to BEA by the Department of Defense is no longer necessary because the two data sources no longer overlap.
- Improved methodology for estimating expenditures by border, seasonal, and other short-term workers beginning with statistics for 2003. These expenditures, which were previously estimated as a share of compensation, are now derived from the U.S. Department of Labor’s Consumer Expenditure Survey and National Agricultural Workers Survey, as well as from H-4 visa statistics from the U.S. Department of State. These expenditures are included in “other” private services receipts (ITA table 1, line 10) and payments (ITA table 1, line 27).
- Reclassification of certain transactions by the U.S. Department of State beginning with statistics for 2003. Estimates of compensation of foreign residents employed abroad by the Department of State, which were previously commingled with transactions in services in U.S. government miscellaneous services payments (ITA table 1, line 28), have been reclassified to compensation payments (ITA table 1, line 34) based on newly available data from the Department of State.
- Introduction of new estimates of cross-border fines and penalties for anti-trust violations and bribery beginning with statistics for 1999. These new estimates, which are derived from publicly available information, are included in “U.S. government pensions and other transfers” (ITA table 1, line 37) and in “private remittances and other transfers” (ITA table 1, line 38).
- Incorporation of new source data from the U.S. Department of the Treasury beginning with statistics for 2012. New monthly data on cross-border holdings of U.S. and foreign long-term securities collected by the Department of the Treasury are incorporated into financial account transactions for long-term securities (ITA table 1, lines 52, 58, 59, 62, 65, and 66). Revisions to transactions are estimated from changes in holdings by excluding changes caused by valuation and changes to the reporting panel. The data are collected on Treasury International Capital Form SLT: Aggregate Holdings of Long-Term Securities by U.S. and Foreign Residents.2
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1 The revised statistics for international transactions in goods and services were released on June 4, 2013 in “U.S. International Trade in Goods and Services: April 2013” and in “U.S. International Trade in Goods and Services: Annual Revision for 2012.”
2 The new SLT data will also be incorporated into the annual revision of the international investment position accounts, which will be released on June 25, 2013.