## tarea2025045-print-pdf ## Source details **Canonical URL:** [tarea2025045-print-pdf](https://www.imf.org/-/media/files/publications/tar/2025/english/tarea2025045-print-pdf.pdf) ## Other formats - [Markdown version](/-/media/files/publications/tar/2025/english/tarea2025045-print-pdf.pdf.md) - [Structured JSON version](/-/media/files/publications/tar/2025/english/tarea2025045-print-pdf.pdf.json) --- ### Mission objectives and scope - TA mission: August 5–9, 2024, at the request of the Economics and Statistics Office (ESO), Cayman Islands. - Objectives: - Update the industry dimension of the SUT to ISIC Revision 5. - Provide guidance on estimating tables one to six of the TSA within the SUT. - Demonstrate different backcasting techniques. - Expand product-dimension detail of the SUT to improve estimates of GFCF, HFCE and IC of transportation goods. - Major new data source for rebasing: Household Budget Survey (HBS) for 2023. - Concurrent exercise: compile tables one to six of a Tourism Satellite Account (TSA) within the SUT. ### ISIC Revision 5 and industry dimension — findings and actions - Findings: - A draft Revision 5 version of ISIC is available and intended to complement the SNA Manual, 2025. - Review of the 2015 SUT against ISIC, Rev. 5 identified many minor ISIC changes and significant definitional changes to Accommodation Services. - ISIC is available at four-digit detail; additional disaggregation beneath four-digit ISIC is required where Cayman-specific activities are significant. - Example disaggregation: ISIC 4921 → 4921_1 (Public Bus) and 4921_2 (Private Bus). - Ensure sufficient detail to identify tourism industries (tourism industry = one that would be significantly reduced in the absence of tourism). Example decomposition: ISIC 9329 → 9329_1 Diving, Snorkelling and Related Activities (tourism), 9329_2 Activities of Night Clubs (not tourism), 9329_3 Operations of Beaches & Recreation Parks (tourism). - Combine ISIC codes where detailed data do not exist (example: Life Insurance as ISIC 6511; non-life insurance & Reinsurance combined as ISIC 6512 and 6520). - Recommended actions for ESO: - Disaggregate four-digit ISIC codes where appropriate and significant. - Ensure sufficient industry detail to identify tourism industries. - Combine ISIC codes when detailed data do not exist. - Use official descriptions and codes as much as possible. - Use the recommended industry detail in Appendix I as a guide. ### Expanding SUT product dimension for transportation goods — findings and actions - Findings: - 2015 SUT transportation products were limited to ‘Motor Vehicles’ and ‘Other Transport Equipment’, both with supply from imports and no domestic production. - Current practice allocated HFCE from HBS and treated GFCF (and CII) as residual; increased product granularity can improve allocation accuracy. - Where HS imports correspond to products exclusively for GFCF, initialize those imports to GFCF. - For four-digit HS codes that may contain both HFCE and GFCF, use HBS to estimate HFCE and allocate residual supply to GFCF (and CII). - Recommended actions for ESO: - Initialize values of GFCF of ‘Motor Vehicles’ and ‘Other Transport Equipment’ using international imports for specified HS codes as illustrated in Table 2. - For four-digit HS codes containing both GFCF and HFCE, use the HBS to estimate HFCE; GFCF (and CII) will be the SUT balancing item. - Selected entries from TABLE 2. HFCE and GFCF Presence of Transportation Goods (HS-Four Digit): - HS 8701 Tractors — HFC E: No — GFC F: Yes - HS 8702 Vehicles; public transport passenger type — HFC E: No — GFC F: Yes - HS 8703 Motor cars and other motor vehicles; principally designed for the transport of persons — HFC E: Yes — GFC F: Yes - HS 8710 Tanks and other armored fighting vehicles — HFC E: No — GFC F: Yes - HS 8901 Cruise ships, excursion boats, ferry-boats, cargo ships, barges — HFC E: No — GFC F: Yes - HS 8903 Yachts and other vessels; for pleasure or sports, rowing boats and canoes — HFC E: Yes — GFC F: Yes ### Estimating TSA tables within the SUT — definitions, methods, and findings - Framework and definitions used: - Methodologies: Statistics Canada’s Canadian Tourism Satellite Account guidance and International Recommendations for Tourism Statistics, 2008. - Tourist: person who spends one or more nights outside their usual environment. - Excursionist: person who spends less than one night outside their usual environment. - Visitors = Tourists + Excursionists. For Cayman Islands, excursionists (e.g., cruise ship visitors) must be included. - Tourism industry: one that would operate at significantly reduced levels in the absence of direct tourism; excludes indirect activities (e.g., cargo handling). - Identified tourism industries for the 2023 SUT (sample from Table 3, TSA = Yes): - 4922_1 Taxi — TSA: Yes - 4922_2 Other passenger land transport — TSA: Yes - 5011 Sea and coastal passenger water transport — TSA: Yes - 51 Air transport — TSA: Yes - 5510 Hotels and similar accommodation activities — TSA: Yes - 5520 Other short term accommodation activities — TSA: Yes - 5610 Restaurants and mobile food service activities — TSA: Yes - 7710 Rental and leasing of motor vehicles — TSA: Yes - 791 Travel agency and tour operator activities — TSA: Yes - 9121 Museum and collection activities — TSA: Yes - 9329_1 Diving, Snorkeling and Related Activities — TSA: Yes - 9329_3 Operations of Beaches & Recreations Parks — TSA: Yes - 9690_3 Wedding & Social Event Planners — TSA: Yes - Data issues identified: - Detailed Balance of Payments (BOP) data contain inconsistencies required by the TSA; instances where exports of tourism products exceed domestic production indicate data problems. - Additional information on travel expenditures is required. - Recommendation: seek additional capacity development (CD) assistance for TSA compilation beyond the mission’s demonstration of a limited benchmark TSA. ### Product dimension and identification of tourism products — guidance and examples - Product identification guidance: - The 2023 SUT product dimension should identify tourism products as much as possible (example: isolate Air Passenger Transport Services from Air Freight Transport). - Selected product — TSA status pairs (from Table 4): - Taxi — Taxi Services – TSA - Other passenger land transport — Charters and Excursions – TSA; Limo Services – TSA - Sea and coastal passenger water transport — Water Passenger Transport – TSA - Air transport — Air Passenger Transport – TSA; Air Freight Transport - Not TSA - Hotels and similar accommodation activities — Accommodation services – TSA - Restaurants and mobile food service activities — Direct Food and Beverages Services – TSA; Catering of Food and Beverages - Not TSA - Beverage serving activities — Direct Food and Beverages Services – TSA - Rental and leasing of motor vehicles — Rental of vehicles – TSA - Travel agency and tour operator activities — Travel agencies and tour operators – TSA - Museum and collection activities — Museums – TSA - Diving, Snorkeling and Related Activities — Diving, Snorkeling and Related Activities – TSA - Operations of Beaches & Recreations Parks — Operations of Beaches & Recreations Parks – TSA - Wedding & Social Event Planners — Wedding & Social Event Planning – TSA ### Estimating domestic tourism supply and demand — methods and examples - Estimating domestic tourism supply: - For each tourism industry, compile output, IC, and VA within the SUT. - Tourism industries with tourist and non-tourist components should be decomposed where possible; otherwise estimated through product balancing reconciliation. - Estimating tourism demand (TSA tables and data sources): - Table 1: inbound tourism demand — expenditures incorporated in BOP and recorded as exports; an International Travel Survey (ITS) should provide total expenditure and breakdown. - Table 2: domestic tourism demand — ESO will assume this is insignificant and initialize it at zero (method used in the TSA of Saint Lucia). - Table 3: outbound tourism demand — information contained in the HBS and should be recorded as an import. - Practical survey breakdown commonly includes: Air Transportation Services, Other Transportation Services, Accommodation Services, Food and Beverage Services, Travel and Tour Operators, Recreational Services. - Balancing tourism products in 2023 SUT: - Product balancing: data considered relatively high quality are not adjusted; product imbalance can be addressed with adjustments to output and HFCE (within reason). - Example from 2015 SUT for Taxi Services (CI$'000): - Domestic Production 10025 - Imports 742 - Taxes less Subsidies 0 - Total Supply at Purchaser Prices 10767 - Intermediate Consumption 0 - Exports 8933 - HFCE 1834 - Total Demand and at Purchaser Prices 10767 - Tourism Expenditure 8933 - Commodity Ratio 0.89 - From the balanced product example, 89 percent of domestic production is used by tourism activity (commodity ratio 0.89). Exports may include a small non-tourism portion (e.g., airplane crew). ### Tourism Value Added (TVA) calculation — methodology and examples - TVA requires commodity ratios for each tourism product. - For industries producing both tourism and non-tourism commodities, compute commodity ratio only for the tourism component and use proportion of VA associated with the tourism product. - Absent other information: assume VA to output ratios are the same for tourism and non-tourism products. - Taxi Industry TVA from 2015 SUT (CI$'000): - Production 10767 - Intermediate Consumption 3391 - Value Added 6634 - Commodity Ratio 0.89 - Tourism Value Added 5911 - Air Transportation example (fictitious data, CI$'000): - Production 15000 - Passenger Transportation 10000 - Freight Transportation 5000 - Intermediate Consumption 10000 - Value Added (1) 5000 - Proportion of Value Added - Passenger Transportation (2) 0.67 - Commodity Ratio - Passenger Transportation (3) 0.90 - Tourism Value Added (1 * 2 * 3) 3000 - Compiling Tourism GDP: - Compile TVA for each tourism industry using the illustrated methods. - Introduce taxes less subsidies on products for tourism products; allocate using commodity ratios. ### Identified anomalies in 2015 SUT and follow-up actions - Identified anomaly: instances where exports were greater than domestic production for some service commodities, yielding commodity ratios greater than 1 (e.g., Water Passenger Transport). - Water Passenger Transport 2015 SUT example (CI$'000): - Domestic Production 15449 - Imports 1238 - Taxes less Subsidies 0 - Total Supply at Purchaser Prices 16688 - Intermediate Consumption 0 - Exports 15775 - HFCE 912 - Total Demand and at Purchaser Prices 16688 - Tourism Expenditure 15775 - Commodity Ratio 1.02 - Recommended follow-up: investigate ratios of exports relative to domestic production when balancing tourism and service commodities. ### Capacity development and priority TSA actions - Further capacity development (CD) is recommended; ESO motivated to produce a TSA as part of GDP rebasing, including indirect and induced effects. - Recommended Actions: - Ensure excursionists are included in the TSA and part of the data collection process. - Use the list in Table 3 when identifying tourist industries. - Isolate tourism commodities when developing SUT product classification. - Seek additional data sources such as an ITS to estimate tourism demand. - Compile commodity ratios to determine Tourism Value Added by Industry. - Investigate services commodities in the 2015 SUT with export to domestic supply ratio greater than one. ### Backcasting methods — findings, demonstrated methods, and recommendations - ESO current practice: fixed ratio backcasting (maintains previously published growth rates at current and constant prices by industry). - Limitations: some annual indicators are relatively low quality while previously published level estimates of Value Added (VA) in prior benchmark may be higher quality. - Recommendation: expand backcasting to include variable ratio backcasting where appropriate and introduce a link year to allow weights to vary. - Backcasting demonstration (values exactly as shown): - Value Added - Current Prices - Base Year 2015: - 15449 15681 15994 16474 16804 16804 17224 17741 18628 - Value Added - Constant Prices - Base Year 2015: - 15449 15635 15791 16107 16429 16478 16643 16976 17485 - Implicit Price Deflator (2015): - 100 100 101 102 102 102 103 105 107 - Recompiled SUT 2023 — Value Added - Current Prices - Base Year 2023: - 17594 18137 18578 19559 - Recompiled SUT 2023 — Value Added - Constant Prices - Base Year 2023: - 18358 18643 18964 19559 - Method 1) Fixed Ratio — Value Added - Current Prices - Base Year 2023: - 16176 16418 16747 17249 17594 - Value Added - Constant Prices - Base Year 2023: - 17212 17418 17592 17944 18303 - % Revision - Current Prices: - 4.70 4.70 4.70 4.70 4.70 4.70 5.30 4.72 5.00 - % Revision - Constant Prices: - 11.41 11.41 11.41 11.41 11.41 11.41 12.01 11.71 11.86 - Method 2) Variable Ratio — Value Added - Current Prices - Base Year 2023: - 15449 15826 16291 16935 17433 - Implicit Price Deflator, Re-Referenced to 2023: - 93.9 94.1 95.1 96.0 96.0 - Value Added - Constant Prices - Base Year 2023: - 16459 16810 17135 17639 18158 - % Revision - Current Prices: - 0.00 0.92 1.86 2.80 3.75 4.70 5.30 4.72 5.00 - % Revision - Constant Prices: - 6.53 7.52 8.51 9.51 10.53 11.41 12.01 11.71 11.86 - Recommended actions (backcasting): - Introduce a Link year in the backcasting exercise. - Consider using variable ratio backcasting for certain industries. - At constant prices, re-reference previously published implicit price deflators (IPD) to 2023 to convert from current to constant prices. - Appendix III contains the formula for variable ratio backcasting (referenced in source). ### Detailed technical assessment, milestones, and priority recommendations (selected with target dates) - Selected milestones and target dates (values exactly as shown): - Develop and release a new Vintage of Supply and Use Tables — Target Completion Date 4/30/2026 — On-going - Update- GDP backcasted results and publish — Target Completion Date 4/30/2026 — On-going - Finalize 2023 SUT — Target Completion Date 10/31/2025 — On-going - Summary of Priority Recommendations and Target Completion Dates (items and dates exactly as shown): - H Update the industry dimension in the SUT to reflect ISIC, Rev.5, especially for Accommodation Services. — October 2024 - H Expand the product dimension of the SUT to improve estimation of GFCF, HFCE and IC of transportation products. — January 2025 - H Investigate product dimension of BOP statistics and collect information on the level and product composition of travel expenditures for the updated benchmark year. — January 2025 - M Disaggregate four-digit ISIC codes into more detail where appropriate data exist, and the detail is significant for the Cayman Islands economy. — October 2024 - H Ensure sufficient industry detail is specified to identify tourism industries. — October 2024 - M Combine ISIC codes when detailed data does not exist. — October 2024 - M Use official descriptions and codes as much as possible. — October 2024 - H Use the recommended industry detail in Appendix I as a guide. — October 2024 - H Initialize values of GFCF of ‘Motor Vehicles’, and ‘Other Transport Equipment’ using international imports for the specified HS codes as illustrated in Table 2. — January 2025 - H For the four-digit HS codes which contain both GFCF and HFCE, use the HSB to estimate HFCE, and GFCF (and CII) will be the SUT balancing item. — January 2025 - H Ensure excursionists are included in the TSA and part of the data collection process. — January 2025 - H When identifying tourist industries, use the list in Table 3 as a guide. — January 2025 - H Isolate tourism commodities as much as possible when developing SUT product classification. — January 2025 - H Seek additional data sources such as an ITS to estimate tourism demand. — October 2024 - H Compile commodity ratios as a method to determine Tourism Value Added by Industry. — July 2025 - H Investigate services commodities in the 2015 SUT which contain an export to domestic supply ratio which is greater than one. — July 2025 - H Introduce a Link year in the backcasting exercise. — January 2026 - H Consider using variable ratio backcasting for certain industries. — January 2026 ### TSA framework, data requirements, and Cayman-specific notes (Appendix II summary) - TSA overview: - TSA is a statistical framework to measure the economic significance of tourism; developed by UNWTO and OECD and uses SNA principles. - Main TSA tables include Tables 1–10 covering inbound, domestic, outbound expenditure, internal tourism consumption, production accounts, employment, GFCF, collective consumption, and non-monetary indicators. - Key data sources: - Supply & Use Tables, other SNA components, fiscal information, supply surveys, annual business survey, demand surveys (Visitor Expenditure Survey & HBS), labour information (LFS, OWS, Annual Business Survey), BOP, capital investment, international trade. - Cayman-specific notes: - Visitor exit survey exists; most likely excludes air travel — question of additional detail availability. - From previous HBS: estimation of residents’ travel expenses as input for the current account of the BOP; distribution over tourism commodities requires a one-time benchmark survey or alternatives. - Definitions and practical guidance: - Tourism commodity: a good or service for which a significant part of its total demand comes from visitors (a significant part approximated in the source as more or less in the range of 15%). - Tourism demand includes all spending by visitors on domestically produced commodities, regardless of whether the commodity is a designated ‘tourist’ commodity. - Practical survey focus: Hotels, Taxi, Vehicle rental/charters/excursions, Restaurants, Travel agencies, Recreation and Entertainment. - Reported mirror statistics (selected as presented): - Mirror block A (selected rows): - 2021P 2020R 2,019 2,018 - 47,668 46,864 92,396 84,375 Transport - 12,669 16,979 28,495 28,567 Sea transport - 26,848 24,428 58,160 50,133 Air transport - 5,480 2,769 29,697 25,771 Passenger - 20,981 21,410 27,852 24,055 Other - 32,568 208,997 765,697 726,149 Travel - 38,048 211,767 795,394 751,919 Total (Travel plus Air) - Mirror block B (selected rows): - 2021P 2020R 2,019 2,018 - 139,933 103,570 154,247 142,704 Transport - 87,862 55,982 59,804 54,270 Sea transport - 45,184 41,317 88,182 82,223 Air transport - 11,739 11,655 59,593 58,298 Passenger - 25,330 19,471 8,706 8,602 Freight - 117,646 122,637 189,462 178,430 Travel - 129,384 134,292 249,054 236,728 Total (Travel plus Air) *IMF | CARTAC Technical Assistance Report – Cayman Islands Rebasing of Gross Domestic Product* ### 1. In response to a request from the Economics and Statistics Office (ESO) in Cayman ### 1. In response to a request from the Economics and Statistics Office (ESO) in Cayman Islands, a technical assistance (TA) mission (August 5–9, 2024) ### Mission objectives and scope - Objectives: - Update the industry dimension of the SUT to ISIC Revision 5. - Provide guidance on estimating tables one to six of the TSA within the SUT. - Demonstrate different backcasting techniques. - Expand product-dimension detail of the SUT to improve estimates of GFCF, HFCE and IC of transportation goods. - Major new data source to be introduced for rebasing: Household Budget Survey (HBS) for 2023. - Concurrent exercise: compile tables one to six of a Tourism Satellite Account (TSA) within the SUT. ### Key findings and technical guidance — ISIC, Rev. 5 and industry dimension - A draft Revision 5 version of ISIC is available and intended to complement the SNA Manual, 2025. - Review of the 2015 SUT against ISIC, Rev. 5 identified: - Many minor ISIC changes to adhere to. - Significant definitional changes to Accommodation Services that must be reflected in the updated SUT. - ISIC is available at four-digit detail; additional disaggregation beneath four-digit ISIC is required where Cayman-specific activities are significant. - Example: ISIC 4921 (Urban and Suburban Passenger Land Transport) can be disaggregated into 4921_1 (Public Bus) and 4921_2 (Private Bus). - Ensure sufficient detail to identify tourism industries (tourism industry = one that would be significantly reduced in the absence of tourism). - Example: decompose ISIC 9329 into 9329_1 Diving, Snorkelling and Related Activities (tourism), 9329_2 Activities of Night Clubs (not tourism), 9329_3 Operations of Beaches & Recreation Parks (tourism). - Combine ISIC codes where detailed data do not exist (example: specify Life Insurance as ISIC 6511 and non-life insurance & Reinsurance as combined ISIC 6512 and 6520). - Recommended actions for ESO: - Disaggregate four-digit ISIC codes where appropriate and significant. - Ensure sufficient industry detail to identify tourism industries. - Combine ISIC codes when detailed data do not exist. - Use official descriptions and codes as much as possible. - Use the recommended industry detail in Appendix I as a guide. ### Key findings and technical guidance — expanding SUT product dimension for transportation goods - 2015 SUT transportation products were limited to ‘Motor Vehicles’ and ‘Other Transport Equipment’, both with supply from imports and no domestic production. - Current practice allocated HFCE from HBS and treated GFCF (and CII) as residual; increased product granularity can improve allocation accuracy. - Where HS imports correspond to products exclusively for GFCF, initialize those imports to GFCF (e.g., HS 8710 Tanks and other armored fighting vehicles → No HFCE; Yes GFCF). - For four-digit HS codes that may contain both HFCE and GFCF, use HBS to estimate HFCE, and allocate residual supply to GFCF (and CII). - Recommended actions for ESO: - Initialize values of GFCF of ‘Motor Vehicles’ and ‘Other Transport Equipment’ using international imports for specified HS codes as illustrated in Table 2. - For four-digit HS codes containing both GFCF and HFCE, use the HBS to estimate HFCE; GFCF (and CII) will be the SUT balancing item. - Selected entries from TABLE 2. HFCE and GFCF Presence of Transportation Goods (HS-Four Digit): - HS 8701 Tractors — HFC E: No — GFC F: Yes - HS 8702 Vehicles; public transport passenger type — HFC E: No — GFC F: Yes - HS 8703 Motor cars and other motor vehicles; principally designed for the transport of persons — HFC E: Yes — GFC F: Yes - HS 8710 Tanks and other armored fighting vehicles — HFC E: No — GFC F: Yes - HS 8901 Cruise ships, excursion boats, ferry-boats, cargo ships, barges — HFC E: No — GFC F: Yes - HS 8903 Yachts and other vessels; for pleasure or sports, rowing boats and canoes — HFC E: Yes — GFC F: Yes ### Key findings and technical guidance — estimating TSA tables within the SUT - Mission focused on direct TSA estimation (tables one to six) using Statistics Canada’s Canadian Tourism Satellite Account guidance and International Recommendations for Tourism Statistics, 2008. - Definitions: - Tourist: person who spends one or more nights outside their usual environment. - Excursionist: person who spends less than one night outside their usual environment. - Visitors = Tourists + Excursionists. For Cayman Islands, excursionists (e.g., cruise ship visitors) must be included. - Purpose of visit for tourism must be leisure, business, or other non-remunerated-from-within-place-visited purposes. - Tourism industry defined as one that would operate at significantly reduced levels in the absence of direct tourism; must be direct tourism (excluding cargo handling, which is indirect). - Using 2015 SUT and compilers’ knowledge, mission identified tourism industries for the 2023 SUT (Table 3 sample): - 4922_1 Taxi — TSA: Yes - 4922_2 Other passenger land transport — TSA: Yes - 5011 Sea and coastal passenger water transport — TSA: Yes - 51 Air transport — TSA: Yes - 5510 Hotels and similar accommodation activities — TSA: Yes - 5520 Other short term accommodation activities — TSA: Yes - 5610 Restaurants and mobile food service activities — TSA: Yes - 7710 Rental and leasing of motor vehicles — TSA: Yes - 791 Travel agency and tour operator activities — TSA: Yes - 9121 Museum and collection activities — TSA: Yes - 9329_1 Diving, Snorkeling and Related Activities — TSA: Yes - 9329_3 Operations of Beaches & Recreations Parks — TSA: Yes - 9690_3 Wedding & Social Event Planners — TSA: Yes - Data issues identified: - Detailed Balance of Payments (BOP) data contain inconsistencies required by the TSA; instances where exports of tourism products exceed domestic production indicate data problems. - Additional information on travel expenditures is required. - Recommendation: seek additional capacity development (CD) assistance for TSA compilation beyond the mission’s demonstration of a limited benchmark TSA. ### Key findings and technical guidance — backcasting methods - ESO has used fixed ratio backcasting: assumes previously published growth rates at current and constant prices by industry are relatively high quality and should be maintained in the backcasted series for all years before the link year. - Limitations identified: - Some annual indicators are relatively low quality while previously published level estimates of Value Added (VA) in the prior benchmark may be higher quality. - Recommendation: - Expand backcasting to include variable ratio backcasting where appropriate. - Introduce a link year to allow weights to vary in the historical time series, regardless of whether fixed or variable ratio methods are used. ### Priority recommendations (Table 1) - October 2024 — Update the industry dimension in the SUT to reflect ISIC, Rev.5, especially for Accommodation Services. — Responsible Institution: ESO - January 2025 — Expand the product dimension of the SUT to improve estimation of GFCF, HFCE and IC of transportation products. — Responsible Institution: ESO - January 2025 — Investigate product dimension of BOP statistics and collect information on the level and product composition of travel expenditures for the updated benchmark year. — Responsible Institution: ESO ### Additional notes - The mission provided training and demonstrations on TSA estimation and backcasting, and recommended further CD for full TSA development. - Detailed actions, milestones, and further recommendations are provided in the action plan under Detailed Technical Assessment and Recommendations (see Section VI and Appendix I for recommended industry detail). *IMF | CARTAC Technical Assistance Report – Cayman Islands Rebasing of Gross Domestic Product* ### 21. Ensure the product dimension is sufficiently detailed. T he ESO will wait for the updated CPC ### 21. Ensure the product dimension is sufficiently detailed. T he ESO will wait for the updated CPC ### Product dimension and identification of tourism products - The 2023 SUT product dimension should identify tourism products as much as possible (example: Air Transport produces both Air Passenger and Air Freight Transport Services; Air Passenger Transport Services should be isolated and estimated). - Table 4 lists primary products associated with each tourism industry and indicates whether it is a tourism product. Selected entries (product = TSA status): - Taxi — Taxi Services – TSA - Other passenger land transport — Charters and Excursions – TSA; Limo Services – TSA - Sea and coastal passenger water transport — Water Passenger Transport – TSA - Air transport — Air Passenger Transport – TSA; Air Freight Transport - Not TSA - Hotels and similar accommodation activities — Accommodation services – TSA - Other short term accommodation activities — Accommodation services – TSA - Restaurants and mobile food service activities — Direct Food and Beverages Services – TSA; Catering of Food and Beverages - Not TSA - Beverage serving activities — Direct Food and Beverages Services – TSA - Rental and leasing of motor vehicles — Rental of vehicles – TSA - Travel agency and tour operator activities — Travel agencies and tour operators – TSA - Museum and collection activities — Museums – TSA - Diving, Snorkeling and Related Activities — Diving, Snorkeling and Related Activities – TSA - Operations of Beaches & Recreations Parks — Operations of Beaches & Recreations Parks – TSA - Wedding & Social Event Planners — Wedding & Social Event Planning – TSA ### Estimating domestic tourism supply (SUT compilation) - For each tourism industry, output, IC, and VA must be compiled within the SUT. - Methods and sources are not fundamentally different from those used in annual GDP compilation. - A potential issue: tourism industries with tourist and non-tourist components (noted in Table 4: Air Transport, Restaurants and Mobile Food Service Activities). - ESO may be unable to separately estimate these components without additional data sources; these will be estimated through product balancing reconciliation. ### Estimating tourism demand (TSA tables and data sources) - Three types of tourism demand correspond to TSA tables: - Table 1: inbound tourism demand — expenditures should be incorporated in BOP statistics and recorded as an export in the SUT. An International Travel Survey (ITS) should provide total expenditure and breakdown corresponding to TSA products in Table 4. - Table 2: domestic tourism demand — ESO will assume this is insignificant and initialize it at zero (method used in the TSA of Saint Lucia). - Table 3: outbound tourism demand — information contained in the HBS and should be recorded as an import. - Practical survey breakdown commonly includes: Air Transportation Services, Other Transportation Services, Accommodation Services, Food and Beverage Services, Travel and Tour Operators, and Recreational Services. - Whatever survey detail is obtained, it must be allocated over TSA products in Table 4 and recorded as exports. ### Balancing tourism products in 2023 SUT - Product balancing follows best practices: data considered relatively high quality are not adjusted. - Tourism products often contain tourism and non-tourism components; the composition must be determined to produce Tourism Value Added (TSA) by industry. - Example from 2015 SUT for Taxi Services (Table 5) — values exactly as shown (CI$'000): - Domestic Production - Taxi Industry 10025 - Imports 742 - Taxes less Subsidies 0 - Total Supply at Purchaser Prices 10767 - Intermediate Consumption 0 - Exports 8933 - HFCE 1834 - Total Demand and at Purchaser Prices 10767 - Tourism Expenditure 8933 - Commodity Ratio 0.89 - In balancing, international trade estimates (BOP) are generally considered relatively high quality; product imbalance can be addressed with adjustments to output and HFCE (within reason). - From the balanced product example, 89 percent of domestic production is used by tourism activity (commodity ratio 0.89). Note: exports may include a small non-tourism portion (e.g., airplane crew). ### Tourism Value Added (TVA) calculation and commodity ratios - TVA by industry requires commodity ratios for each tourism product. - For industries producing both tourism and non‑tourism commodities (Air Transportation, Food and Beverage Services), compute commodity ratio only for the tourism component and use proportion of VA associated with the tourism product. - Assumption (absent other information): VA to output ratios are the same for tourism and non-tourism products. - Taxi Industry TVA calculation from 2015 SUT (Table 6) — values exactly as shown (CI$'000): - Production 10767 - Intermediate Consumption 3391 - Value Added 6634 - Commodity Ratio 0.89 - Tourism Value Added 5911 - Air Transportation example using fictitious data (Table 7) — values exactly as shown (CI$'000): - Production 15000 - Passenger Transportation 10000 - Freight Transportation 5000 - Intermediate Consumption 10000 - Value Added (1) 5000 - Proportion of Value Added - Passenger Transportation (2) 0.67 - Commodity Ratio - Passenger Transportation (3) 0.90 - Tourism Value Added (1 * 2 * 3) 3000 ### Compiling Tourism GDP - Compile TVA for each tourism industry using the methods illustrated in Tables 5, 6 and 7. - Introduce taxes less subsidies on products for tourism products; for each tourism product compile taxes less subsidies allocated to tourism (use commodity ratio for allocation). ### Identified anomalies in 2015 SUT and investigation - Instances discovered where exports were greater than domestic production for some service commodities, yielding commodity ratios greater than 1 (unlikely for trade in services; re-exports are not common). - Investigate ratios of exports relative to domestic production when balancing tourism and service commodities. - Water Passenger Transport 2015 SUT example (Table 8) — values exactly as shown (CI$'000): - Domestic Production 15449 - Imports 1238 - Taxes less Subsidies 0 - Total Supply at Purchaser Prices 16688 - Intermediate Consumption 0 - Exports 15775 - HFCE 912 - Total Demand and at Purchaser Prices 16688 - Tourism Expenditure 15775 - Commodity Ratio 1.02 ### Capacity development and recommended actions (tourism and TSA) - Further capacity development (CD) is recommended; ESO motivated to produce a TSA as part of GDP rebasing, including indirect and induced effects. - Recommended Actions (from report): - Ensure excursionists are included in the TSA and part of the data collection process. - When identifying tourist industries, use the list in Table 3 as a guide. - Isolate tourism commodities as much as possible when developing SUT product classification. - Seek additional data sources such as an ITS to estimate tourism demand. - Compile commodity ratios as a method to determine Tourism Value Added by Industry. - Investigate services commodities in the 2015 SUT which contain an export to domestic supply ratio which is greater than one. ### Backcasting methods for rebasing to 2023 - Introduce a link year: when rebasing to 2023, updated estimates will be backcast to at least the previous base year. A link year could be the mid-year between previous and updated base year (example: link year could be 2019). From 2020 to 2022 recompile series with updated source data, SUT, methodology; backcasting commences between 2019 and 2020. - Consider variable ratio backcasting for certain industries instead of fixed ratio backcasting: - Fixed ratio backcasting maintains previously published growth rates and imposes the same weights on entire historical series. - Variable ratio backcasting can wedge revised levels back to earlier base year while emulating previously published series and producing no revision in the earlier base year. - At constant prices, previously published implicit price deflators (IPD) can be re-referenced to 2023 to convert from current to constant prices. - Appendix III contains formula for variable ratio backcasting (referenced in source). - Table 9 demonstration (values as shown): - Value Added - Current Prices - Base Year 2015 - 15449 15681 15994 16474 16804 16804 17224 17741 18628 - Value Added - Constant Prices - Base Year 2015 - 15449 15635 15791 16107 16429 16478 16643 16976 17485 - Implicit Price Deflator (2015) - 100 100 101 102 102 102 103 105 107 - Recompiled SUT 2023 — Value Added - Current Prices - Base Year 2023 - 17594 18137 18578 19559 - Recompiled SUT 2023 — Value Added - Constant Prices - Base Year 2023 - 18358 18643 18964 19559 - Method 1) Fixed Ratio — Value Added - Current Prices - Base Year 2023 - 16176 16418 16747 17249 17594 - Value Added - Constant Prices - Base Year 2023 - 17212 17418 17592 17944 18303 - % Revision - Current Prices - 4.70 4.70 4.70 4.70 4.70 4.70 5.30 4.72 5.00 - % Revision - Constant Prices - 11.41 11.41 11.41 11.41 11.41 11.41 12.01 11.71 11.86 - Method 2) Variable Ratio — Value Added - Current Prices - Base Year 2023 - 15449 15826 16291 16935 17433 - Implicit Price Deflator, Re-Referenced to 2023 - 93.9 94.1 95.1 96.0 96.0 - Value Added - Constant Prices - Base Year 2023 - 16459 16810 17135 17639 18158 - % Revision - Current Prices - 0.00 0.92 1.86 2.80 3.75 4.70 5.30 4.72 5.00 - % Revision - Constant Prices - 6.53 7.52 8.51 9.51 10.53 11.41 12.01 11.71 11.86 - Recommended Actions (backcasting): - Introduce a Link year in the backcasting exercise. - Consider using variable ratio backcasting for certain industries. ### Detailed technical assessment, milestones, and priority recommendations (selected) - Selected milestones and target dates (Table 10 and Table 11 entries, values exactly as shown): - Develop and release a new Vintage of Supply and Use Tables — Target Completion Date 4/30/2026 — On-going - Update- GDP backcasted results and publish — Target Completion Date 4/30/2026 — On-going - Finalize 2023 SUT — Target Completion Date 10/31/2025 — On-going - Summary of Priority Recommendations and Target Completion Dates (Table 11, items and dates exactly as shown): - H Update the industry dimension in the SUT to reflect ISIC, Rev.5, especially for Accommodation Services. — October 2024 - H Expand the product dimension of the SUT to improve estimation of GFCF, HFCE and IC of transportation products. — January 2025 - H Investigate product dimension of BOP statistics and collect information on the level and product composition of travel expenditures for the updated benchmark year. — January 2025 - M Disaggregate four-digit ISIC codes into more detail where appropriate data exist, and the detail is significant for the Cayman Islands economy. — October 2024 - H Ensure sufficient industry detail is specified to identify tourism industries. — October 2024 - M Combine ISIC codes when detailed data does not exist. — October 2024 - M Use official descriptions and codes as much as possible. — October 2024 - H Use the recommended industry detail in Appendix I as a guide. — October 2024 - H Initialize values of GFCF of ‘Motor Vehicles’, and ‘Other Transport Equipment’ using international imports for the specified HS codes as illustrated in Table 2. — January 2025 - H For the four-digit HS codes which contain both GFCF and HFCE, use the HSB to estimate HFCE, and GFCF (and CII) will be the SUT balancing item. — January 2025 - H Ensure excursionists are included in the TSA and part of the data collection process. — January 2025 - H When identifying tourist industries, use the list in Table 3 as a guide. — January 2025 - H Isolate tourism commodities as much as possible when developing SUT product classification. — January 2025 - H Seek additional data sources such as an ITS to estimate tourism demand. — October 2024 - H Compile commodity ratios as a method to determine Tourism Value Added by Industry. — July 2025 - H Investigate services commodities in the 2015 SUT which contain an export to domestic supply ratio which is greater than one. — July 2025 - H Introduce a Link year in the backcasting exercise. — January 2026 - H Consider using variable ratio backcasting for certain industries. — January 2026 *IMF | CARTAC Technical Assistance Report – Cayman Islands Rebasing of Gross Domestic Product* ### Appendix II: Presentation to ESO on TSA ### Appendix II: Presentation to ESO on TSA ### Overview of the Tourism Satellite Account (TSA) Framework - The Tourism Satellite Account (TSA) is a statistical framework used to measure the economic significance of tourism and its contribution to a country's economy. - Developed by the UN World Tourism Organization (UNWTO) and the Organisation for Economic Co-operation and Development (OECD). - The TSA uses the principles of the System of National Accounts (SNA) and is based on a set of definitions, classifications, and accounting rules agreed upon by international organizations. ### The Challenge of Measuring Tourism - Most economic activities are easily identifiable in national accounts; tourism is not explicitly defined and is spread across many sectors. - The TSA uses the national accounts framework to measure travel and tourism activity according to subsets (e.g., All People (Non-Visitors), All consumption, Visitors, Tourism Products). - Key risk: identifying only typical tourism industries (hotels, air/water/rail transport) leads to UNDERESTATEMENT; capturing all expenditures in broad categories (Eating and Drinking Places, SHOPPING) leads to OVERSTATEMENT. ### Types of Tourism in the TSA - Domestic: Residents' tourist activities within country of reference. - Inbound: Non-resident tourist activities within the country of reference. - Outbound: Residents' tourist activities outside country of reference. ### TSA Main Tables (by table number and title) - Table 1 — Inbound tourism expenditure - Table 2 — Domestic tourism expenditure - Table 3 — Outbound tourism expenditure - Table 4 — Internal tourism consumption - Table 5 — Production Accounts of Tourism Industries - Table 6 — Domestic supply and internal tourism consumption - Table 7 — Employment in tourism industries - Table 8 — Gross fixed capital formation - Table 9 — Tourism collective consumption - Table 10 — Non-monetary indicators ### Coverage of Tables — Key descriptions and aggregates - Table 1: Categories of tourism expenditure observable from visitors; tourism expenditure derives from International Recommendations for Tourism Statistics 2008. - Table 2: Domestic tourism expenditure. - Table 3: Outbound tourism expenditure. - Table 4: Internal tourism consumption — Sums domestic and inbound tourism expenditure (T1 & T2) plus additional components not easily attributable to the different forms of tourism; key aggregate is internal tourism consumption (use). - Table 5: Production accounts of tourism industries — supply table focusing on tourism characteristic products and tourism industries; similar to production accounts in national accounts, though classifications and reservation service providers recorded differently. - Table 6: Domestic supply and internal tourism consumption — the core of the TSA: reconciliation of internal tourism consumption with domestic supply; key aggregates: Tourism direct gross value added (TDGVA) and tourism direct gross domestic product (TDGDP). - Table 7: Employment in tourism industries — useful for employment policy. - Table 8: Tourism Gross fixed capital formation — focuses on GFCF by tourism industries; considered lower priority. - Table 9: Tourism collective consumption — identifies tourism expenditure on collective consumption; considered lower priority. - Table 10: Non-monetary indicators — used to support analysis of other tables. ### Non-Monetary Indicators (examples listed) - number of trips by forms of tourism - classes of visitors - duration of the stay - physical indicators regarding types of accommodation - modes of transport used by non-resident visitors travelling to the economic territory of the country of reference - number and size of the establishments belonging to tourism industries ### Data Requirements — Summary of data sources - Supply & Use Tables - Other parts of the System of National Accounts - Fiscal Information - Supply Surveys - Annual Business Survey - Demand Surveys (Visitor Expenditure Survey & HBS) - Labour Information: LFS, OWS, Annual Business Survey - Other information: Balance of Payments, capital investment, international trade ### Supply and Use Tables and Balance of Payments - SUT show the direct impact of tourism on the economy by tracking flows of goods and services between industries and final demand. - In theory, if SUT is sufficiently specified, Tables 1, 2, 3, 4, 5, 6, 8 and 9 can be compiled; Tables 7 and 10 are normally outside SUT scope and often partially estimated then refined out of SUT compilation. - Balance of Payments tables provide information on contribution of tourism to the balance of payments, including exports and imports of tourism goods and services such as accommodation services, food and beverage services, transportation services. ### Tourism Demand — definition and composition - Tourism demand is total spending by visitors (tourists and excursionists) on domestically produced commodities, REGARDLESS (theory) of whether or not the commodity is a designated ‘tourist’ commodity — relates to Tables 1, 2 and 4. - Must be directly consumed by the tourist; e.g., fuel purchased by an ocean liner while in port would not be included. - Can be split into components: - Tourism domestic demand — expenditures by residents in country (Table 2). - International demand — expenditures by non-residents (Table 1). - External demand (outbound) — Table 3. - Focus on large commodities (transportation, accommodation, recreation). - Practical data sources: - International Travel Survey (ideally at airport departures with detailed expenditure questions). - Visitor exit survey (Cayman Islands: visitor exit survey likely excludes air travel — query: "Do we have more detail?"). - Balance of Payments travel component: travel comprises earnings from visitors for both business and personal purposes. - One-time benchmark Detailed International Travel Survey (accommodation, transportation, meals, recreation) is suggested if more detail is not available. - Mirror statistics as supplementary information. ### Cayman Islands specific notes (as presented) - Cayman Islands: Visitor exit survey exists; most likely excludes air travel — question raised regarding additional detail availability. - From previous HBS: estimation of residents’ travel expenses as input for the current account of the Balance of Payments (BOP); distribution over tourism commodities requires a one-time benchmark survey or alternative methods. ### Definitions (as presented) - Tourism: activities of persons travelling to and staying in places outside their usual environment for not more than one consecutive year for leisure, business and other purposes not related to the exercise of an activity remunerated from within the place visited. - Broader than “leisure travel”; includes business, visiting friends and relatives, religious purposes, medical treatment. - Usual environment relates to place where individual lives and works or studies and includes any other places frequented; not precisely defined internationally. - Example: Canada defines “outside the usual environment” as greater than 80 kilometers one way from home. (Question: Cayman Islands?) - Tourist: persons travelling outside their usual environment who spend one or more nights in the place visited. - Same-day visitors (excursionists): those who do not spend any nights at the place visited. - Visitors = Tourists + Excursionists. - Tourism Commodity: a good or service for which a significant part of its total demand comes from visitors (what constitutes “a significant part” is not precisely defined, but more or less in the range of 15%). - air passenger transportation = tourism commodity. - groceries in a supermarket = not a tourism commodity in most countries, but amount purchased by visitors IS part of TSA. - International definitions: - Tourism characteristic products: those which in the absence of visitors, in most countries would probably cease to exist in meaningful quantity. - Tourism-connected products: products that may be important in given countries but are not specified among the commodities listed for international comparison. - Non-Tourism products: those which in the absence of visitors would still exist at nearly full amounts, but some purchases by tourists. ### Tourism Industries - An industry is a group of establishments engaging in same or similar economic activity. - Tourism is not an industry in this sense; it cuts across industries. - In the TSA, a tourism industry is one which as a direct result of the absence of tourism would cease or continue to exist only at ‘significantly reduced levels of activity’. - Compiling a list of tourism industries is straightforward. ### Tourism Domestic Supply - Tourism domestic supply = total production (gross output) of tourism commodities. - Excludes production of secondary output on tourism industries. - Outputs such as retailing margins, royalties and license fees, non-residential rent, and rental, other machinery and equipment are considered non-tourism commodities if tourism is not a significant source of their demand; these are excluded so only tourism commodities produced by tourism industries remain in tourism domestic supply calculations. ### Tourism Demand — Practical data collection focus (listed commodities for surveys) - Hotels - Taxi - Vehicle rental, charters and excursions - Accommodations - Restaurants - Travel agencies - Recreation and Entertainment (Creative arts & entertainment, Museum Activities, Preservation of Historical Sites, Monuments, Botanical and Zoological Gardens, Nature Reserves Activities, Diving, Snorkeling and Related Activities, Operations of Beaches & Recreation Parks, Gambling and betting activities) - In practice, likely settle for data on Hotels, Transportation, charters and excursions, restaurants, travel agencies, Recreation and Entertainment. ### Key reported mirror statistics (as presented) - Mirror block A: - 2021P 2020R 2,019 2,018 - 47,668 46,864 92,396 84,375 Transport - 12,669 16,979 28,495 28,567 Sea transport - ---- Freight - 12,669 16,979 28,495 28,567 Other2 - 26,848 24,428 58,160 50,133 Air transport - 5,480 2,769 29,697 25,771 Passenger - 386 248 611 307 Freight - 20,981 21,410 27,852 24,055 Other - 8,151 5,457 5,741 5,674 Postal and courier services - 2021P 2020R 2,019 2,018 - 32,568 208,997 765,697 726,149 Travel - 38,048 211,767 795,394 751,919 Total (Travel plus Air) - Mirror block B: - 2021P 2020R 2,019 2,018 - 139,933 103,570 154,247 142,704 Transport - 87,862 55,982 59,804 54,270 Sea transport - 87,862 55,982 59,804 54,270 Freight - ---- Other2 - 45,184 41,317 88,182 82,223 Air transport - 11,739 11,655 59,593 58,298 Passenger - 25,330 19,471 8,706 8,602 Freight - 8,116 10,191 19,884 15,323 Other - 2,785 2,353 2,391 2,410 Postal and courier services - 2021P 2020R 2,019 2,018 - 117,646 122,637 189,462 178,430 Travel - 129,384 134,292 249,054 236,728 Total (Travel plus Air) *Appendix II: Presentation to ESO on TSA — IMF | CARTAC Technical Assistance Report – Cayman Islands Rebasing of Gross Domestic Product* --- _Source: https://www.imf.org/-/media/files/publications/tar/2025/english/tarea2025045-print-pdf.pdf_