External sector statistics and transition to BPM6: experience of the

National Bank of the Republic of Kazakhstan

Bazarova Salima

Deputy Director Balance of Payments, Currency Regulation and

Statistics Department

Vladivostok, 2014

Legislation

Law of the Republic of Kazakhstan

• «On state statistics» (dated 19 March 2010 ):• NBRK is defined as a state statistical agency

• Roles and responsibilities – Article 13

• «On the National bank of the Republic of Kazakhstan» (with amendmentsas of 5 July 2012)

• One of the functions is to “generate external sector, monetary and financial statistics”

• Pertinent functions std in Article 8, paragraphs 16-18

Resolution of the Government of the Republic of Kazakhstan on «Balance of Payments of the Republic of Kazakhstan» (№71 dtd. 29/01/1999 )

• Defines responsibilities of government agencies, enterprises and organisations for submitting statistical accounting to NBRK

• Deadline for the balance of payment • Balance of Payment – in accordance with the Plan of statistical work (no later

than the 90th day of the reporting period)

Resolution of the Government of the Republic of Kazakhstan on«Plan of statistical production for the year of 2014» (№1209 dtd. 12/11/2013)

• List of statistical surveys and compilations

• Deadlines for data submission 2

3

Frameworks

• Prior to 2013 the compilation of the external sector statistics of Kazakhstan was conducted in accordance with the 5th edition of the Balance of Payments Manual, 1993 (BPM5)

• After the publication of the revised BPM6 in 2009, the NB initiated a transition to the new methodology.

• Starting with the reports from the 1st quarter of 2013, external sector statistics is compiled in accordance with the BPM6(data conversion for the period from 2005 to 2012 (incl.) has been implemented to achieve comparability of time series).

• Developed by international organisations: IMF, OECD, UN, BIS, World Bank, etc.

Methodological support

Press release of the National Bank of the Republic of Kazakhstan dtd. June 28, 2013 №25

• On transition to the new methodology of external sector statistics and on the balance of payments and external debt situation of the Republic of Kazakhstan as of the 1st quarter of 2013.

Order of the Chairman of the National Bank of the Republic of Kazakhstan dtd. December 29, 2012 №408

• «On Approval of the Methodology of Foreign Economic Activity accounting (external sector statistics) by the National Bank of the Republic of Kazakhstan»

Quarterly publication of the NBRK «Balance of Payment andExternal Debt of the Republic of Kazakhstan»

• Methodological notes on balance of payment and internationalinvestment position.

• Information database for compilation of BOP and IIP of Kazakhstan.

• Calculation methods for analytical indices and BOP estimates.

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5

Linkages with other guidelines

2009, 20132007 20082001

2008 2008 2010 2011

2009

2013

Framework for compiling data on foreign direct investments

Framework for compiling external debt data

Production of the external sector statistics

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Balance of Payment and Currency Regulation

Department Statistics Department

Balance of Payment, Currency Regulation and Statistics

Department BPCRSD

Data collection and processing – external sector statistics

BPCRSD

AISS «Data collection and processing– balance of payment»AISS «Repository of registrations(notifications) of currency transactions»

AISS «Statistics», AISS «Pilot project of the NBRK webpage», AISS«Data repository for full scale project»,

AISS «Collection and processing of the accounting and statistical data on payments», AISS «BIS Т24»

Government Agencies

Foreign trade in goods

outside of the Customs

Union

Mutual trade in goods in the Customs Union,

Statistical business register,Data on foreign economic

operations of the individuals

Data on quantity of people leaving/entering

RK

Data on public external loans, current

transactions, external public sector assets.

Data on grants of technical

assistance

Data on labour migration

Banks (39)

Currency exchange bulletins

6 stat. forms 9 forms for admin.

data

NBRK

DMO & AM, FA & FOMD, AD, NIC –

data on assets/reserves of the National Fund

Securities traders (46)

1 stat. form,1 form for admin. data

Registration documents/ currency

transaction notifications,

2 statistical forms,4 forms for admin

data

Insurance companies (35)

2 statistical forms

Registration documents / currency

transaction notifications,2 stat. forms,

4 forms for admin data

16 Branches of NBRK

Branches of foreign

companies (200)

3 statistical forms,6 forms on admin

data (currency monitoring)

Individuals

Registration documents/

currency transaction

notifications,4 forms for admin

data

Registration documents / currency transaction notifications,

9 stat. forms,4 forms for admin data

CN

Enterprises involved in foreign economic activities (11 000)

CCC of theMoF

Statistics Committee of the MNE Border control of the NSC MoF MNE MHCSD

Production and dissemination of external sector statistics by NBRK

1) Agreement with IMF

2) The Special Data DisseminationStandard (SDDS)

3) Government decree on “ Thebalance of Payment of the Republicof Kazakhstan” (№71 dtd.29/01/1999)

4) The statistical work plan, annuallyapproved by the Government of theRepublic of Kazakhstan (17compilations on external sectorstatistics)

5) Agreements on informationexchange in the frames of integrationunions

6)Agreements on informationexchange with government agencies

7) Regulations for governmentagencies on data provision for thedatabase of the Analytical complexunder the Presidential Administrationof the Republic of Kazakhstan

Regulations

For the President and the Government of the RK

• Preliminary and actual BP• Data on IIP• Data on external debt

National page on Special Data

Dissemination Standard (SDDS)

• Balance of payment• International reserves and foreign currency liquidity • International Investment Position (IIP)• External Debt

IMF

• Quarterly and annual data on BP and IIP• Annual (3) and semi annual (1) surveys of direct, portfolio investments and reserve

assets, • Monthly report on international reserves and liquidity

IBRD • Quarterly (8 tables) and annual (3 tables) external debt statistics

UNCTAD • Annual data on foreign direct investments (10 tables)

Analytical Complex under the Presidential

Administration of the RK

• Data on BoP (3 tables)• Data on external debt (5 tables)• Data on foreign investments (6 tables)• Data on real exchange rate (3 tables)• Data on import and export of cash in foreign currency (1 table)

Statistics committee of the

MNE

• Data on foreign investments (9 tables) for CISSTAT• Data for informing SNA СНС (4 tables)• Extended Balance of Payments Services (1 table)

MNE of the RK • Operational monitoring (4 tables)

Inte

rnat

ion

al

org

anis

atio

ns

FSD • Data for the financial stability report (37 tables)

Webpage of NBRK

• Balance of payment (4 tables)• IIP (5 tables)• External Debt(13 tables)• Direct investments based on directional principle(15 tables)• International reserves and foreign currency liquidity (1 monthly report)• Real Effective Exchange Rate (2 monthly tables)

Publication • «Balance of Payment and the External Debt of the Republic of Kazakhstan»

For

pu

blic

dis

sem

inat

ion

Go

vern

men

t age

nci

es

RSAD, DMO and AM, DSCM

• Data for press releases and reports prepared by the Government and NBRK• Data оn retirement of government external borrowing • Data on import/export of foreign cash by banks

NBRK

Balance of Payments of the Republic of Kazakhstan: USD bln 2011 2012 2013

Current Account 10,2 0,6 -0,1Goods 44,8 37,9 33,7

Credit (Exports) 85,2 86,9 83,4Debit (Imports) 40,3 49,1 49,7

Services -6,6 -8,0 -6,9Credit (Exports) 4,3 4,8 5,3Debit (Imports) 11,0 12,9 12,1

Primary income -27,7 -28,2 -25,3Credit (receivable) 2,2 2,1 2,3Debit 30,0 30,2 27,7

Secondary income -0,3 -1,0 -1,6Credit (receivable) 2,7 2,6 2,7Debit (payable) 3,0 3,6 4,3

Capital account 0,0 0,0 -0,01Credit (receivable) 0,0 0,0 0,01Debit (payable) 0,0 0,0 0,0

Net lending (+) / net borrowing (-) (balance from current and capital accounts) 10,2 0,7 -0,1

Financial account 6,4 -3,4 -5,9

Net lending (+) / net borrowing (-) (balance from financial account)6,4 -3,4 -5,9

Direct investment -8,6 -11,7 -7,8Net acquisition of financial assets 5,2 1,9 1,9Net incurrence of liabilities 13,8 13,7 9,7

Portfolio investment 13,0 17,4 6,0Net acquisition of financial assets 13,6 15,1 8,5Net incurrence of liabilities 0,6 -2,3 2,5

Financial derivatives (other than reserves) and employee stock options -0,1 0,1 0,1

Net acquisition of financial assets -0,2 -0,1 0,0Net incurrence of liabilities -0,1 -0,2 -0,1

Other investments 1,8 -4,8 -1,8Net acquisition of financial assets 3,5 2,5 4,7Net incurrence of liabilities 1,7 7,3 6,5

Reserve assets 0,3 -4,3 -2,4Net errors and omissions -3,8 -4,0 -5,8 9

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Changes in the presentation of the direct investment

• In accordance with BPM5 direct investments (DI) were recorded on the directional basis (DI to the country and abroad). DI on the directional basis were netted against assets and liabilities.

• In BPM6 direct investment is presented on an assets and liabilities basis for standard presentation. For analytical purposes, NBRK applies presentation on the directional basis.

• Given that BoP of the RK contains large volume of reverse DI (claims on direct investors and liabilities to affiliated enterprises) presentation of the BoP and IIP on the asset/liability principle would better reflect the DI.

• In BPM6, (and primary income accounts) in addition to activities between direct investors and direct investment enterprises a special category is included. This is the separate category of investment between fellow enterprises if ultimate controlling parent is resident, non resident or is unknown.

Direct investment: asset/liability presentation

Claims (Assets)

Investment by a resident direct investor in non-

resident direct

investment enterprises

Reverse investment by a resident direct investment

enterprise in its

non-resident direct investor(s)

Investment by a resident fellow enterprise in non-

resident fellow

enterprises

Liability

Investment of non-resident direct investor in resident

direct investment

enterprises

Reverse investment of non-resident direct investment

enterprises in

resident direct investors

Investment of non-resident fellow enterprises in resident

fellow

enterprises

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Direct Investment - directional principle

• Presentation of data reflects the direction of influence by the direct investor underlying the direct investment.

Directional principle

Direct investment abroad

Claims on enterprises of direct investment and debt liabilities to enterprises of direct investment

Claims on foreign fellows is ultimate controlling parent is a resident and liabilities to them

Claims on foreign fellows, if ultimate controlling parent is

unknown

Direct investment in reporting economy

Debt liabilities to foreign direct investors and claims on direct

investors

Debt liabilities to fellow foreign enterprises if ultimate controlling

parent is a non resident and claims on them

Debt liabilities to fellow foreign enterprises if ultimate controlling

parent is unknown 12

Statistics » External sector statistics» Direct Investments Statistic according to the directional principle

DI on directional

basis (cumulative

data):

DI on directional

basis (cumulative

data):

Flows for the period

Income for the period

Position as of the end of the

period

Gross DI flows

(dynamics since 2005)

Gross DI flows

(dynamics since 2005)

Inflow to RK by country

Inflow to RK by types of

residents’ economic activity

Outflow abroad by countries

Outflow by types of residents’

economic activity

Net inflow of DI

(for the period)

Net inflow of DI

(for the period)

Inflow by country

Inflow by types of residents’

economic activity

Outflow by countries

Outflow by types of residents’

economic activity

DI Net position at the end of the period

DI Net position at the end of the period

By countries

By types of residents’ economic

activity

Income payable to

foreign direct investors(for the period)

Income payable to

foreign direct investors(for the period)

By countries

By types of residents’ economic

activity

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Gross inflow of direct investment into Kazakhstan from foreign direct investors

•Acquisition by a non resident of voting shares or equities in Kazakh enterprises that result in at least 10 % of the voting shares owned by the non resident, • equity growth by a foreign direct investor in the Kazakh enterprise with no change in participation ratio,•acquisition of a real estate by a non resident inKazakhstan.

Equity growth

• Direct investors’ shares of the undistributed earnings(losses) of Kazakhstan enterprises.

Reinvested earnings

• Disbursements (in cash and in other forms : goods, works, services, intangible assets, securities etc) of foreign direct investors (excluding repayments).

Increase of debt instruments

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• Acquisition by a resident of voting shares or equities in foreign enterprises that result in at least 10 % of the voting shares owned by the resident,

• equity growth by a Kazakh direct investor in foreign enterprise with no change in participation ratio

• acquisition of a real estate by a resident abroad.

Equity growth

• Kazakh direct investors’ shares in the undistributed earnings (losses) of foreign enterprises.

Reinvested earnings

• Disbursements (in cash and in other forms : goods, works, services, intangible assets, securities etc) of Kazakh direct investors (excluding repayments).

Increase of debt

instruments

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Gross outflow of direct investment abroad fromKazakh direct investors

External Sector StatisticsInternational Investment Position

IIPIIP

IIP, standard presentation

IIP by residents’ economic sector

IIP by type of residents’ economic activity

IIP by countries

External liabilities of residents of Kazakhstan by types of their

economic activity and the main countries

Net flows for the period Net flows for the period

Net incurrence of liabilities of Kazakhstan: breakdown by

residents' types of economic activities

Net incurrence of liabilities of Kazakhstan: breakdown by

countries

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International Investment Position of Kazakhstan

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In USD, billionsAs of 31/12/2013 As of 30/03/2014

Net International Investment Position -32,0 -25,6

Assets 177,1 181,2

Direct investments 29,1 28,0

Portfolio investments 72,8 76,8Financial derivatives (other than reserves) and employee stock options 0,2 0,2

Other investments 50,3 49,6

Reserve assets 24,7 26,5

Liabilities 209,1 206,7

Direct investments 129,6 126,4

Portfolio investments 22,1 21,2Financial derivatives (other than reserves) and employee stock options 0,1 0,1

Other investments 57,4 59,1

Transactional and non-transactional changes in the IIP of Kazakhstan

In USD, billions

IIP as of 31/12/13

Changes in IIP as for the quarter 1 of 2014

IIP as of 31/03/14

Changes due tothe

transactionsconducted

Price change

Other

External assets of the RK

(1) 177,1 4,4 0,0 -0,3 181,2

External liabilities of the RK

(2) 209,1 2,9 -6,5 1,3 206,7

IIP of the RK (3=1-2) -32,0 1,5 6,5 -1,6 -25,6

Including debt instruments

(4) -17,3 2,3 0,1 -1,0 -15,8

Net external debt of RK

(5= - 4) 17,3 -2,3 -0,1 1,0 15,8

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External Debt

• Outstanding amount of those actual current and not contingent liabilities that require payment of principal and/or interest by the debtor at some point in the future and that are owed to non residents by residents of an economy.

External debt (ED) at the

reporting date

• Coherent with BOP and IIP.

Institutional sectors and

classification of instruments

• Difference between gross external debt assets and the liabilities.

• Net external debt of Kazakhstan is presented in the IIP table by economic sector.

Net external debt

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External debt of Kazakhstan

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In USD, billions

As of 31/12/2012

As of 31/12/2013

As of 31/03/2014

External debt 136,9 148,8 151,2

Short-term 9,1 9,4 10,0

Long-term 127,8 139,4 141,2

General Government 4,9 5,1 5,0

Short-term 0,0 0,0 0,0

Long-term 4,9 5,1 5,0

Central Bank 0,6 0,5 0,9

Short-term 0,1 0,0 0,3

Long-term 0,5 0,5 0,5

Banks 13,5 11,2 10,5

Short-term 1,6 1,2 1,0

Long-term 11,8 9,9 9,5

Other sectors (excluding intercompany lending) 50,5 59,2 60,8

Short-term 7,4 8,2 8,6

Long-term 43,2 51,1 52,1

Direct investment: Intercompany lending 67,4 72,7 74,1

Debt liabilities of direct investment enterprises to direct investors

63,5 68,9 70,2

Debt liabilities of direct investors to direct investment enterprises (reverse investment)

3,4 3,1 3,1

Debt liabilities between fellow enterprises

0,5 0,7 0,7

Statistics» External Sector Statistics » External Debt

Key tables

• External dept, standard presentation

• External debt, analytical presentation

• Absolute and comparative indicators of the external debt

Analytical tables

• External debt by country• External debt by residents'

types of economic activities

• Foreign and Domestic Currency External Debt

• External debt in foreign currency

• Debt securities (issued by residents and belong to nonresidents) by the place of issues

• Long-term external debt of the creditor sectors

• Outstanding External Debt and Debt Service Schedule

• Short-Term External Debt Remaining Maturity Basis

• Public Sector External Debt

Lending terms

• By sector/ period / interest rate

• By sector/ currency / interest rate

• By currency/ period / interest rate

• By sector/ relationship / interest rate

• By debtor's/creditor’s sector/ interest rate

• By debtor's/creditor’s sector/ period

• By country / creditor’s sector

• By country/ relationship• By activity type of debtor/

creditor’s sector

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Public sector external debt

In USD, billionsAs of

31/03/2014

Public sector, total 32,9

Government agencies 5,0

National bank 0,9

Banks 5,3

Other sectors 18,5

Direct investment: intercompany lending 3,3

Public Sector External Debt

Government debt (debt of the general

government and central bank)

Debt of banks and organisations which are subject to control (directly or indirectly ) by

government or central bank through ownership of more than half of the voting shares or otherwise controlling more than

half of the shareholder voting power

Debt, secured by government

guarantees or liabilities

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International Initiatives

• NBRK participates in IMF initiatives on statistics of externaleconomy (SDDS, QEDS, SEFER, INFER, CDIS, CPIS, etc)

• Provides external sector data to IMF, UNSD, UNCTAD, WB andother international organisations (balance of payment, IIP,external debt, direct foreign investments)

• NBRK data on extended BoP services and internationalinvestment position is published in IMF «International FinancialStatistics» and «Balance of Payments Yearbook»

Cooperation with Eurasian Economic Commission

• Starting the 1st quarter of 2014, NBRKprovides official data on financial statistics

( 20 templates of EEC)

• Regular meetings and events(videoconferences)

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Looking aheadTransition to the new standards of external sector statistics –the 6th edition of the Balance of Payments manual, IMF(BPM6) – 2014-2015.

ü Review of the survey forms in line with BPM6.

ü Development of valuation methods for some BOP indicators (financial intermediation services indirectly measured (FISIM), reinvested earning of investment funds, insurance etc. ).

ü Review of the data series from 2005 for FISIM, investment funds and insurance companies, transactions with fellow companies and transactions of branches of construction companies.

ü Production of historical time series for BOP, IIP, ED, FDI up to the reference year 2005.

ü Amendments to the Rules of Monitoring of the foreign exchange transactions of non residents on the territory of the RK.

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Looking ahead

Compliance with the OECD and IMF in the production of external debt and direct investment statistics

ü Production of FDI statistics, excluding transit capital flows, in accordance with the OECD requirements.

ü Production of additional analytical tables on external debt,including data on contingent liabilities of residents and nonresidents resulting from guarantees and commitments (inaccordance with the updated manual on external debt statistics).

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