Archive:Trade integration of goods and services

Data from September 2008, most recent data: Further Eurostat information, Main tables and Database.

Graph 1: Trade integration, EU-27 (1) (% of GDP)

This article takes a look at trade integration of goods and services, measured as debits and credits of an economy relative to its gross domestic product. Higher values indicate higher integration within the international economy.

The economy of the European Union was more integrated with the international economy in 2007 than at any time in the previous five years.

Main statistical findings

Table 1: Share of goods and services in GDP, 2007 (1) (% of GDP)

The trade integration indicator (in terms of the credits and debits relative to GDP) shows that the economy of the EU-27 was more integrated with the international economy in 2007 than at any time in the previous five years. The average value of EU trade flows of goods corresponded to 10.7 % of GDP in 2006, a much higher ratio than the EU-25 relative low of 8.8 % in 2003, reflecting a broad upturn in economic activity. Although the volume of external trade in services is less than that for goods, the trade integration of services also rose, reaching the equivalent of 3.7 % of GDP in 2007.

The EU-27 had a trade deficit with the rest of the world in goods that equated to -1.2 % of GDP in 2007, in contrast to a trade surplus in services that corresponded to 0.7 % of GDP. There were stark contrasts among the Member States, reflecting among other factors, the relative size of the country and differences in respective economic structures. Trade deficits in goods were equivalent to one fifth or more of GDP in Cyprus, Bulgaria and Latvia. In contrast, the trade surpluses in goods recorded in Ireland, Germany and the Netherlands were equivalent to 12.3 %, 8.4 % and 6.8 % of GDP respectively in 2007, the highest relative levels among the Member States. Relative to GDP, there were large trade surpluses in services recorded in Luxembourg, Cyprus and Malta in 2007.

Data sources and availability

Within the EU, there are two main sources for statistics on external trade.

• External trade statistics (ETS) provide information on trade in goods, collected predominantly on the basis of customs and Intrastat declarations. ETS provide information on the value and volumes (quantity) of external trade in goods with great detail concerning the type of commodity.
• Balance of payments (BoP) statistics register all the transactions of an economy with the rest of the world. The current account of the BoP provides information not only on external trade in goods (generally the largest category), but also on external transactions in services, income (from employment and investment) and current transfers. For all these transactions, the BoP registers the value of exports (credits) and imports (debits), the difference of which is usually referred to as the balance (surplus or deficit).

Trade integration of goods and services is measured as the average value of debits and credits (summed together and divided by two) expressed relative to GDP. This indicator is calculated for both goods and services, based on BoP data; higher values indicate higher integration within the international economy. It is normal that smaller countries will display a higher recourse to external trade, as they are more likely to import a range of goods and services that are not produced within the domestic market.

Context

External trade statistics are used extensively by public body decision makers at an international, EU and national level, as well as by the private sector. In the case of EU authorities, external trade statistics help in the preparation of multilateral and bilateral trade negotiations, in defining and implementing anti-dumping policies, for the purposes of macroeconomic and monetary policies and in evaluating the progress of the Single market, or the integration of European economies. In the private sector, businesses can use external trade data to carry out market research and define their commercial strategy.

Further Eurostat information

Publications

• EU economic data pocketbook
• European Union international transactions – analytical aspects – detailed tables on CD-ROM – data 1991-2001 (PDF)
• Differences between balance of payments and foreign trade statistics

Main tables

• External trade, see:

External trade aggregated data (t_ext)

External Trade (t_externaltr)

External trade short-term indicators (t_ext_sti)

Database

• External trade, see:

External Trade

External trade aggregated data

External trade detailed data

• Balance of payments, see:

Balance of payments - International transactions (bop)

Balance of payments statistics and International investment positions (bop_q)

Euro area balance of payments (source ECB) (bop_q_euro)

European Union balance of payments (bop_q_eu)

Balance of payments by country (bop_q_c)

International trade in services, geographical breakdown (bop_its)

International trade in services (since 2004) (bop_its_det)

International trade in services (from 1985 to 2003) (bop_its_deth)

International trade in services - structural indicators (bop_its_str)

Total services, detailed geographical breakdown by EU Member States (since 2002) (bop_its_tot)

International trade in services - Data for the Eurostat yearbook (bop_its_ybk)

Dedicated section

• External trade
• Balance of payments

Methodology/Metadata

• External trade data [ESMS metadata file - ext_esms]
• Balance of payments [ESMS metadata file - bop_esms]
• Balance of payments statistics and International investment positions [ESMS metadata file - bop_q_esms]
• International trade in services, geographical breakdown [ESMS metadata file - bop_its_esms]

See also

• External trade introduced