Annually re-weighted
The volume estimate of GDP of a specific year is the sum of aggregated volume estimate of the respective components using the price weights of the preceding year as base. In other words, the price weights are updated every year.
Chain linking
In order to obtain a continuous time series of volume indices, it is necessary to link up the relatively independent volume indices of each year or each quarter. This is done by selecting a particular year as the reference year for linking up the volume indices of other years to the
reference year, in order to obtain a time series of the chain volume indices of GDP and its major
components.Chain volume measures
The volume measures of GDP obtained by the “annually re-weighted” and “chain linking”
approach.
Changes in inventories
The difference between the value of the closing and the opening inventories of an accounting period. Inventory includes all goods destined for intermediate consumption or commercial purposes such as materials and supplies, work-in-progress, finished goods and goods for resale.
Compensation of employees
Total remuneration, in cash or in kind, earned by employees in return for employment in the accounting period.
Compensation of employees consists of two main components:
1. Wages and salaries payable in cash or in kind;
2. Value of social contributions payable by employers: these may be actual social contributions payable by employers to governmental or private funds to secure social benefits for their employees; or imputed social contributions by employers providing unfunded social benefits.
Consumption of fixed capital
The decline, during the course of the accounting period, in the current value of the stock of fixed assets as a result of physical deterioration, normal obsolescence or normal accidental damage.
Costs of ownership transfer
Expenses incurred for the transfer of ownership of land and buildings.
Deflating
A process to remove the effect of price change, through which the current price estimate of different components of GDP is compiled to volume terms using the relevant price index.
Direct investment income
Refers to earnings of residents derived from direct investment (10% or more equity in an enterprise) outside the territory of the economy, or earnings of non-residents derived from direct investment within the territory of the economy. Direct investment income includes receipts of distributed profits, share of undistributed profits and interest receipts from debts of affiliated companies outside the economy. Undistributed profits are considered as re-investment as they are retained profits after-tax.
Domestic demand
Sum of private consumption expenditure, government final consumption expenditure, gross fixed capital formation and changes in inventories.
Expenditure-based GDP
Expenditure-based GDP at current market prices of an accounting period is the sum of private consumption expenditure, government final consumption expenditure, gross fixed capital formation, changes in inventories and exports, less imports, which are valued at purchasers’
prices.
Export of goods
Commodities transported out of Macao, excluding transit and temporary export of goods.
Export of services
Services sold or provided by residents of Macao to non-residents.
External demand
Value of exports of goods and services.
External factor income
Refers to income earned outside the economy by residents or within the economy by non-residents, comprising direct investment income, portfolio investment income, other investment income, income on reserve assets, compensation of employees and other primary income.
Financial Intermediation Services Indirectly Measured (FISIM)
Refers to the additional auxiliary services accompanied when banks are engaging in borrowing and lending activities, namely setting up branches, automatic teller machines, network linkages, on-line banking, credit assessment of borrowers, channeling of funds, etc. Respective cost of such services is not collected directly from the depositors and borrowers, yet recovered indirectly through paying lower interest rate to the depositors and charging higher interest rate to the borrowers, which is known as Financial Intermediation Services Indirectly Measured (FISIM).
Total value of FISIM equals gross amount of the interest receivable less interest payable of banks; however, value of FISIM payable by various depositors or borrowers ought to be estimated indirectly, in which the 2008 SNA recommends to use the Reference Interest Rate to compile and allocate FISIM among different depositors and borrowers.
Fixed assets
Refer to the produced assets that are used continuously, in processes of production for more than one year.
Global demand
Sum of domestic demand and external demand.
Government final consumption expenditure
Equals the value of the provision of goods and services by the institution. As the services produced and consumed are not for sale, they are valued at the cost of production that covers intermediate consumption, compensation of employees, consumption of fixed capital, less sales of goods and services. Government final consumption expenditure is subdivided into individual and collective consumption expenditure.
Individual consumption expenditure relates to personal goods and services acquired by a household to satisfy the needs of household members, for instance, education, health, social security, recreation, cultural services, etc.
Collective consumption expenditure relates to collective services provided to the community as a whole, such as public order and security, maintenance of law, legislation and regulation, maintenance of public health, environmental protection, services of public facilities, research and development, etc.
Gross capital formation
Sum of gross fixed capital formation and changes in inventories.
Gross fixed capital formation (GFCF)
Total value of the producers’ acquisitions, less disposals, of fixed assets in an accounting period, plus improvements to land and costs associated with the transfer of ownership of non-produced assets. Fixed assets are subdivided into tangible and non-tangible assets, of which tangible fixed assets include:
− Dwellings;
− Non-residential buildings and other structures;
− Machinery and equipment, such as transport equipment, as well as other machinery and equipment;
− Cultivated assets: livestock or trees that grow continuously for more than one year for the production of other goods or services;
− Others.
Non-tangible fixed assets include computer software.
Gross fixed capital formation also includes buildings and other construction work in progress,
the existing fixed assets, as well as real estate developers’ margin. Total value of acquisition of fixed assets includes transport costs, installation charges and costs of ownership transfer incurred by the purchaser, whereas value of disposal of fixed assets has to deduct any costs of ownership transfer incurred by the seller.
Gross National Income (GNI)
Refers to total income earned by residents of an economy from engaging in various economic activities within or outside the economy in the accounting period.
Gross output
Sum of the market value of goods or services sold by enterprises, the non-market value of goods or services produced for own use or provided by the government and non-profit institutions serving households (NPISHs), value of financial intermediation services indirectly measured (FISIM), as well as value of changes in the inventories. Gross output can be calculated at basic prices or producers’ prices. Basic price is the amount receivable by a producer for a unit of good or service provided, which excludes any taxes on the products concerned, while producers’ price is the amount receivable by a producer for a unit of good or service provided, which excludes any taxes on imports on the products concerned.
Gross value added
Gross output minus intermediate consumption.
Implicit deflator of gross domestic product
Index obtained by dividing the current price estimate of GDP by its chain volume measure, which is used for measuring the overall price change of an economy.
Import of goods
Commodities entered from abroad to Macao, excluding transit goods and re-imports.
Import of services
Services acquired or purchased by residents of Macao from non-residents.
Income on reserve assets
Income from foreign currency assets that are readily available to and controlled by the Monetary Authority of Macao.
Intermediate consumption
Actual value of goods and services consumed as input during the production process, including any taxes on products but excluding fixed assets and valuables.
Market output
Goods or services that are sold or disposed of at market prices.
Net external demand
Value of exports of goods and services minus value of imports of goods and services.
Nominal growth rates
Growth rates that are calculated based on current prices, valued at monetary market values of goods and services.
Non-resident
Refers to individuals or institutions that do not meet the definition of Resident of an economy.
Operating surplus
Gross value added minus compensation of employees and relevant taxes on production and on imports.
Other investment income
Refers to investment income other than those derived from direct investment, portfolio investment and reserve assets, which is the income receivable and payable of residents from holding of financial assets and liabilities outside the economy, e.g. other equity (equity in an enterprise which is not in the form of securities but less than 10%), deposits, loans/borrowings and trade credits, which are net of financial intermediation services.
Other non-market output
Goods and produced by the government or non-profit institutions serving households
(NPISHs) that are supplied free, or at non-market prices, to other institutional units or the community as a whole.
The value of goods and services produced as non-market output by the government or NPISHs are all valued as the sum of costs incurred in their production, that is, as the sum of:
- Intermediate consumption;
- Compensation of employees;
- Consumption of fixed capital;
- Other taxes on production.
Other taxes on production
All types of taxes, except taxes on products, which enterprise incurs as a result of engaging in production. They are levied on land, fixed assets or labour force employed in the production process or on certain activities or transactions. Such taxes do not include taxes on profits or other income received by the enterprise. In Macao, other taxes on production mainly include the followings that are paid by producers: industrial taxes, stamp duties, administrative licenses, fees collected by the Land, Public Works and Transport Bureau for issuing licenses, fees collected by the Macau Government Tourist Office for issuing licenses, taxes of justice, fees charged by the Registration and Notary Services, the share of the Fund of the Legal Affairs in the fees charged by the Registration and Notary Services, etc.
Output produced for own final use
Goods or services that are produced for own use as intermediate consumption or capital formation.
Goods and services produced for own final use should be valued at the market prices at which they could be sold if offered for sale in the market. If these prices are not available, they are deemed to be equal to the sum of their costs of production, that is, as the sum of:
- Intermediate consumption;
- Compensation of employees;
- Consumption of fixed capital;
- Other taxes on production.
Portfolio investment income
Refers to equity earnings and interest receipts of residents derived from investment in
non-resident equity securities (less than 10% equity securities in an enterprise) and debt securities, or those of non-residents derived from investment in resident equity and debt securities.
Private consumption expenditure
Sum of the value of expenses on goods and services consumed by resident households and non-profit institutions serving households.
Production-based GDP
Sum of gross value added of resident producers of all economic activities (industries) in an accounting period, plus relevant taxes.
Real estate developers’ margin
The margin realised by real estate developers through the development of properties (from land acquisition to sales of new properties).
Real growth rates
Growth rates that are calculated based on chain volume measures.
Reference interest rate
Interest rate as recommended by the System of National Accounts, adopted to calculate the amount of FISIM paid by depositors and borrowers. Reference interest rate excludes service element and be able to reflect the risk and maturity structure of the deposits and loans; the prevailing inter-bank interest rate is an appropriate choice as the reference interest rate.
Reference interest rate ought to fall within the deposit interest rate and the lending interest rate.
Reference year
A year to which the time series of the volume measures is referenced, with the objective to provide a reference time point for linking up the annual volume indices to obtain the time series of the volume measure.
Resident
Refers to individuals or institutions of an economy that maintain their centre of economic interest within the territory of that economy. In practice,
1. For an individual, it refers to a person who has stayed or intends to stay in that economy for at least 12 months, irrespective of nationality or legal status.
2. For an institution, it refers to the producing unit that operates principally in that economy;
however, for those that do not actually operate or engage in real production (e.g. holding company) but are legally incorporated in that economy, they are also considered as resident producing units.
Structure of GDP
The structure of GDP that is calculated based on current prices.
Taxes on production and on imports
Taxes on products plus other taxes on production.
Taxes on products
Taxes that are payable per unit of goods or service at the moment when it is produced, sold, imported, exported, leased, transferred, delivered or used for own consumption or own capital formation. In Macao, taxes on products mainly include: excise duties, stamp duties on transaction of properties, income from exclusive concessions of telecommunications, electricity and water supply services, income from games of chance or other forms of gaming (i.e. gaming tax), of which special gaming tax predominates.