Archive:International trade statistics introduced
- Latest update of text: October 2016. Planned article update: October 2017.
International trade in goods can be seen as the first step in the process of globalisation. It has allowed countries to specialise in the production of certain goods while relying on trade to obtain others. In the 18th century, economists such as Adam Smith and David Ricardo made convincing cases that such trade was mutually beneficial.
Services play a major role in all modern economies: those such as transport, communications and business services provide vital support to other parts of the economy. Increased trade in services and the widespread availability of services may boost economic growth by improving the performance of other activities, since services can provide key intermediate inputs, especially in an increasingly interlinked and globalised world. The value of international trade in services is typically less than that in goods. Part of this difference may be due to the nature of some services, for example, the immediacy of the relationship between supplier and consumer means that many services are non-transportable; in other words, they require the physical proximity of the service provider and the consumer. Furthermore, professional services may be bound by national regulations hampering cross-border trade.
Trade policy
The European Union (EU) has a common international trade policy, often referred to as the common commercial policy. In other words, the EU acts as a single entity on trade issues, including issues related to the World Trade Organisation (WTO). In these cases, the European Commission negotiates trade agreements and represents Europe’s interests on behalf of the EU Member States.
The EU Treaty (TEU) (also called the Treaty of Maastricht) establishes the overall aims and objectives of the EU’s trade policy: Article 3 sets out the general aims, including a competitive social market economy, aimed at full employment and social progress. Article 206 of the Treaty on the functioning of the Union (TFEU) explains how the common commercial policy must operate in principle: ‘to contribute, in the common interest, to the harmonious development of world trade, the progressive abolition of restrictions on international trade and on foreign direct investment, and the lowering of customs and other barriers’. Article 207 of the TFEU sets out the scope, instruments and decision-making procedures, while Article 218 establishes the current inter-institutional procedure for the conclusion of international agreements, principally by the Council.
The EU’s trade policy aims to make the EU competitive in foreign markets. Being an open economy, the EU seeks to secure improved market access for its industries, services and investments, and to enforce the rules of free and fair trade. A coordinated trade policy takes on even greater importance in an era of globalisation, where economies and borders have opened-up, leading to an increase in trade and capital movements, and the spread of information, knowledge and technology, often accompanied by deregulation. The economic impact of globalisation on the EU is felt through trade in goods and services, as well as through financial flows and the movement of persons linked to cross-border economic activity.
Specific developments
Globally, multilateral trade issues are managed under the auspices of the WTO. For more information about the WTO and progress on the latest round of WTO multilateral trade negotiations — known as the Doha Development Agenda (DDA) — see an article on international trade in goods.
The Trade in Services Agreement (TiSA) is a trade agreement being negotiated by 23 members of the WTO, including the EU, other members of the Organisation for Economic Co-operation and Development (OECD), as well as Hong Kong, Liechtenstein, Mauritius, Pakistan, Panama, Peru and Taiwan; negotiations started in March 2013. Together, the participating countries account for approximately 70 % of world trade in services. TiSA is based on the WTO’s General Agreement on Trade in Services (GATS), which involves all WTO members. TiSA aims to open up markets and improve rules in areas such as licensing, financial services, telecoms, e-commerce, maritime transport, and professionals moving abroad temporarily to provide services.
In addition to these global negotiations the European Commission negotiates with regions and with individual countries, for example the 2015 economic partnership agreements with West, East and Southern Africa and the 2016 free trade agreement with Vietnam.
The European Commission is in the process of negotiating transatlantic trade agreements with Canada and with the United States, the first referred to as the Comprehensive Economic and Trade Agreement (CETA) and the latter as the Transatlantic Trade and Investment Partnership (TTIP). These could potentially simplify the trade in goods and services between the EU and Canada or the United States. Other ongoing trade negotiations include those between the EU and Indonesia, Japan, Mexico, the Philippines and Tunisia. More information in relation to these negotiations is available from the website of the European Commission’s Directorate-General for Trade.
International trade statistics
Within the EU, there are two main sources of international trade statistics. One is international trade in goods statistics, providing information on trade in merchandise goods, collected on the basis of customs and Intrastat declarations. This provides highly detailed information on the value and quantity of international trade in goods as regards the type of commodity. The second main source is balance of payments statistics (BoP), which register all the transactions of an economy with the rest of the world. The current account of the BoP provides information on international trade in goods and services, as well as income (from employment and investment) and current transfers. For all these transactions, the BoP registers the value of exports (credits) and imports (debits), this source is used to present information on international trade in services. Balance of payments data are currently based on the sixth edition of the IMF’s balance of payments manual.
See also
Further Eurostat information
Main tables
- International trade in goods - long-term indicators (t_ext_go_lti)
- International trade in goods - short-term indicators (t_ext_go_sti)
Database
- International trade in services, geographical breakdown (BPM6) (bop_its6)
- International trade in goods – aggregated data (ext_go_agg)
- International trade in goods - long-term indicators (ext_go_lti)
- International trade in goods - short-term indicators (ext_go_sti)
- International trade in goods - detailed data (detail)
- International trade in services (since 2010) (BPM6) (bop_its6_det)
- Total services, detailed geographical breakdown by EU Member States (since 2010) (BPM6) (bop_its6_tot)