## GZTT Meeting (May 13, 2021) — Summary of Discussions

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### Introduction and overview of GZTT work program
- Co-chairs welcomed participants.
- Draft conclusions of the April 6-8 AEG Meeting include GZTT-relevant topics:
  - Classification of guidance notes (GNs) by impact on SNA/BPM “central framework” or core accounts:
    - Distinction made by GZTT: (i) changes to boundaries or core accounts; (ii) supplementary tables (within boundaries); and (iii) extended/satellite accounts (outside boundaries).
  - Testing phase of GNs:
    - Some GNs are based on well-established practices and may not need further testing.
    - GZTT should recommend which notes are subject to further testing.
  - SPEs and MNEs GN approved for global consultation; questionnaires are being developed to be posted by UNSD and simultaneously posted on the GZTT page on the IMF’s BPM update website.
- Substantial progress on workplan since last meeting; AEG identified first priorities:
  - CIF-FOB valuation of imports/exports.
  - Economic ownership and recording of intellectual property products (IPPs).
  - Treatment of MNEs and SPEs.
  - Intra-MNE flows.
  - Identifying economic presence and residency.
- Additional GNs rolled over from the defunct IPTT into GZTT:
  - Transfer pricing within MNE group.
  - Payments for “knowledge-based” (non-produced) capital.
- Many Task Team issues are intertwined and should be considered holistically.
- Ongoing collaboration with other Task Teams: Current Account Task Team (CATT), Direct Investment Task Team (DITT), and Digitalization Task Team (DZTT).

### Status of guidance notes (GNs) and review priorities
- Status summary:
  - G.1 Valuation of Imports and Exports (CIF/FOB adjustment) – Completed – Stage 2 testing.
  - G.2 Treatment of MNEs and Intra-MNE Flows – Completed – Global consultation in May/June 2021.
  - G.4 Treatment of SPEs and Residency – Completed – Global consultation in May/June 2021.
  - G.3 Transfer Pricing within MNE Group – To be drafted after G.5.
  - G.5 Economic Ownership and Recording of Intellectual Property Products – In progress – Expected circulation to GZTT in June 2021.
  - G.6 Merchanting and Factoryless Goods Producers and Recording of their Transactions – In progress – Expected circulation to GZTT/CATT in June 2021.
  - G.7 Global Value Chains and Trade in Value-Added – In progress – Expected circulation to GZTT July 2021.
  - G.8 Typology of Global Production Arrangements – Linked to G.6.
  - G.9 Payments for “Knowledge-Based” (Non-Produced) Capital – In progress – Expected circulation to GZTT in July 2021.
- GN-specific notes:
  - G.1 testing targets both balance of payments and national accounts compilers and includes a two-staged approach: (i) wider audience and (ii) targeted approach for selected countries. The first stage is now closed.
  - G.2 global consultation will address: (i) if MNEs are material; (ii) support for the GZTT recommendations; (iii) implementation questions. Given GN is based on well-established practices, assumption is no need for further testing.
  - G.4 global consultation will focus on: (i) if SPEs are material and there is user demand for data; (ii) support for the GN’s recommendations; (iii) current data collection initiative on SPEs for ESS; and (iv) whether SPE Operational Guidelines by BOPCOM are comprehensive enough for national accounts purposes.
  - DITT’s GN D.5 “Eliminating Imputations for Entities Owned or Controlled by General Government for Fiscal Purposes” was shared with GZTT for feedback; only a few members provided comments and these have been reflected in the GN.
- GNs reviewed by GZTT at the meeting:
  - DITT D.5, CATT C.6, CATT C.5.2, and DITT D.4.
- Coordination and workload points agreed:
  - Workplan in upcoming months is quite full; co-chairs and Secretariat will consider better distribution of GN review and additional time for comments.
  - Need to further clarify consultation process of GNs by joint BP/SNA Task Teams and the coordination process between the BPM and SNA update.

### Valuation of imports and exports: survey testing results and next steps
- Stage 1 testing ended on April 27, 2021.
- Participation and completion:
  - One hundred seventeen economies submitted completed answers.
  - 12 economies still need to be contacted to clarify details.
  - China, P.R.: Mainland did not provide a complete answer.
  - By statistical domain, 105 economies submitted complete answers for balance of payments and 98 economies submitted complete answers for national accounts.
- Of the complete answers, 42 economies agreed to be further contacted concerning the study on invoice values.
- Next steps:
  - Further analyze qualitative answers to open questions.
  - Contact economies with duplicate answers that are not consistent.
  - Contact economies that agreed to be contacted for Phase 2 of study.
  - Present Stage 1 testing results at the next UNECE and BOPCOM meetings.
- GZTT members’ observations:
  - The number of answers reveals interest in the topic.
  - It will be useful to analyze additional details, e.g., present results by share of the economies in World trade and the impact on trade balance.
  - Results of the consultations will be shared with GZTT members.

### Agreed actions
- The GZTT Secretariat will:
  - Re-circulate the MNE and SPE GN (Completed).
  - Bring the topic on coordination between the SNA and BPM update to discussion at the next ISWGNA meeting.
  - Reach out to China, P.R.: Mainland to obtain the answer to the survey on the valuation of imports and exports of goods.
  - Follow-up with Germany on the timeline for stage 2 of consultation on the valuation of imports and exports of goods.
  - Share the results of the consultation on the valuation of imports and exports with GZTT members.
  - Inform the GZTT when D.5 will go for public consultation in case members wish to provide further feedback.

### Upcoming meetings
- UNECE Group of Experts on National Accounts, May 17–26, 2021.
- BOPCOM meeting June 21–24, 2021.
- AEG meeting July 6–9, 2021 (tentative).
- BOPCOM meeting October 26–28, 2021.
- AEG meeting October 2021 (tentative).

### Participants
- Co-chairs:
  - Mr. Michael Connolly (Ireland Central Statistics Office).
  - Mr. Branko Vitas (Australian Bureau of Statistics).
- Selected participants from countries and agencies include:
  - Ms. María Lourdes Erro Azcarate (Central Bank of Uruguay – Retired).
  - Mr. Paul Feuvrier (Central Bank of Luxembourg).
  - Mr. Satoru Hagino (Fukuyama University, Japan).
  - Ms. Grace Kim (Australian Bureau of Statistics).
  - Ms. Natalia Kupriyanova (Central Bank of Russia).
  - Mr. Dylan Rassier (Bureau of Economic Analysis, United States).
  - Mr. Jens Walter (Deutsche Bundesbank).
  - Ms. Jennifer Withington (Statistics Canada).
  - Mr. Celestino Giron (ECB).
  - Mr. Rami Peltola (UNECE).
  - Mr. Phil Stokoe (IMF).
  - Ms. Laura Wahrig (Eurostat).
- IMF Secretariat:
  - Ms. Jennifer Ribarsky.
  - Ms. Padma Sandhya Hurree Gobin.
  - Ms. Margarida Martins.
- Unable to attend (selected):
  - Ms. Ann Lisbet Brathaug (Statistics Norway).
  - Ms. Yang Can (State Administration of Foreign Exchange (SAFE), China).
  - Mr. Sanjiv Mahajan (Office of National Statistics, United Kingdom).
  - Mr. Roberto Ramos (Getúlio Vargas Foundation, Brazil).
  - Mr. Andrey Tatarinov (ROSSTAT, Russia).

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_Source: https://www.imf.org/-/media/files/data/statistics/bpm6/gztt/gztt-meeting-minutes-may-13-2021.pdf_