## The data module of the Report on the Observance of Standards and Codes (ROSC) — _cr06387 ## Source details **Canonical URL:** [The data module of the Report on the Observance of Standards and Codes (ROSC) — _cr06387](https://www.imf.org/-/media/websites/imf/imported-full-text-pdf/external/pubs/ft/scr/2006/_cr06387.pdf) ## Other formats - [Markdown version](/-/media/websites/imf/imported-full-text-pdf/external/pubs/ft/scr/2006/_cr06387.pdf.md) - [Structured JSON version](/-/media/websites/imf/imported-full-text-pdf/external/pubs/ft/scr/2006/_cr06387.pdf.json) --- ### Overview and institutional setup - Panama has a well-developed macroeconomic statistical system; legal framework assigns responsibility for socio-economic statistics to the Controller General of the Republic of Panama (CG), but the scope is not specified. - In practice: - CG compiles and disseminates national accounts, consumer price index (CPI), fiscal, and external statistics. - Ministry of Economy and Finance (MEF) compiles and disseminates fiscal statistics. - No central bank; Superintendency of Banks of Panama (SBP) provides banking sector statistics aligned with supervisory functions. - Monetary statistics concepts in the DQAF/MFSM are not fully applicable because of long-standing dollarization and absence of a central bank; several DQAF elements for monetary statistics are not applicable (see Box 1). - Panama has participated in the GDDS since December 2000; metadata regularly updated on the DSBB. ### Main data strengths and institutional dimensions - Legal/institutional features and operational capacity: - CG legal mandate: Article 280 of the 1972 Constitution; Presidential Decrees 7 and 194 of 1960 and 1997; Law 32 of 1984; authority to request data from public and private entities; confidentiality protections; sanctions for noncompliance exist but nominal amounts outdated. - CG achieves de facto independence through professional tradition; staff well trained but face resource and remuneration constraints; heavy reliance on temporary staff in parts of the Directory of Statistics and Census (DSC). - MEF: authority over public finances and public debt information; staff size adequate and compensation above other public entities; production legally protected from political interference. - SBP: designated agency for banking sector statistics; adequate staff size and competitive salaries; legal independence; limited formal consultation with private users. - Commitment to statistical development: - Agencies support implementation of the National Strategy for Statistical Development (NSSD) and engaged users in 2005 through five seminars and two surveys (producers and users). ### Methodological soundness and international standards — key conformity and shortcomings - Broad conformity with international standards: - System of National Accounts 1993 (1993 SNA) - Consumer Price Index Manual, 2004 (CPI 2004) - Balance of Payments Manual, fifth edition (BPM5) - MEF follows A Manual on Government Finance Statistics, 1986 (GFSM 1986); no official commitment to migrate to GFSM 2001. - Noted methodological shortcomings: - Quarterly GDP at constant prices (introduced in 2005) use outdated input/output ratios from 1996; base year of 1996 is outdated. - CPI coverage excludes certain households (rural, one-person, lowest and highest deciles); methodological issues on missing prices and quality adjustments. - NFPS statistics exclude the Panama Canal Authority (PCA) and use financing data only for institutions not in the sample of non-budgetary institutions. - Monetary statistics concepts and definitions are not applicable to SBP banking sector statistics though scope and recording broadly consistent with MFSM. - BOP shortcomings: - Recording interest on external public debt on a cash basis and not excluding resident holdings. - Not compiling direct investment abroad (FDI abroad). - Trade statistics compromised by source data problems from free trade zones (CFZ). ### Accuracy, reliability, and source-data issues - General assessment: Accuracy and reliability broadly adequate but require improvement across most datasets. - Specific source-data issues: - Price data collection sometimes not on the same date each month due to funding shortfalls. - 2001 business register updated only by adding new enterprises; does not remove enterprises that have exited. - Household income and expenditure survey frequency: every 10 years (HIES rounds historically 10–13 years). - Discrepancies between production and expenditure GDP estimates cannot be investigated because some expenditure components are not independently derived (private consumption largely residual). - BOP surveys incomplete for some private-sector services and financial transactions (e.g., direct investment abroad). - Processes for assessment and validation of source data needed; regular revision studies not conducted except for major national accounts and CPI revisions. ### Serviceability and accessibility - Serviceability — timeliness and periodicity: - GDDS recommendations for periodicity and timeliness are met, and exceeded for: - GDP estimates (quarterly at constant prices) - CPI timeliness (15 days) - Public debt (disseminated monthly) - BOP and IIP (disseminated quarterly) - Timeliness of banking sector statistics should be improved given early availability of source data. - Statistics generally consistent within datasets; some cross-dataset discrepancies exist without always providing explanatory notes. - Revision studies, when conducted, are not generally made public except for the CPI. - Accessibility: - Data released to all users on a preannounced schedule, except for GFS flows disseminated by the MEF and banking sector statistics. - Summary metadata available in the GDDS; detailed methodology available only for national accounts, CPI, and BOP. - Unpublished non-confidential data generally available on request but such availability not publicized. - CG publishes press releases and an advance release calendar; some legal and methodological information not posted on CG website. - Dissemination formats: many primary electronic releases in PDF rather than spreadsheets. ### User feedback and engagement - Users consider macroeconomic statistics accurate and reliable; agencies professional and helpful. - Usage patterns (user-survey): - National accounts: 88 percent of respondents use NA. - Prices: 92 percent use price statistics. - GFS: 71 percent; Monetary/Financial 67 percent; BOP 67 percent. - Sources of official statistics: Controller General 100 percent; SBP 54 percent; MEF 63 percent. - Overall quality rating: average 4.0 (scale 1–5); domain ratings: NA 4.0; CPI 4.1; WPI 4.2; GFS 3.8; MS 4.0; BOP 3.8. - Users request greater periodicity and timeliness (private industry and financial sector), better adherence to release/revision calendars, and improved fiscal revision policy. - Agencies credited for providing additional breakdowns and explaining revisions on request. ### DQAF-based summary assessment — selected dimension outcomes - Key to symbols: O = Practice Observed; LO = Practice Largely Observed; LNO = Practice Largely Not Observed; NO = Practice Not Observed; NA = Not Applicable - Dimension highlights (by domain: National Accounts; CPI; Government Finance; Monetary; Balance of Payments) - Dimension 0. Prerequisites of quality: - 0.1 Legal and institutional environment: National Accounts LO; CPI LO; Government Finance O; Monetary LO; Balance of Payments LO - 0.2 Resources: National Accounts LO; CPI LNO; Government Finance LO; Monetary LO; Balance of Payments LO - 0.3 Relevance: National Accounts O; CPI LO; Government Finance O; Monetary LO; Balance of Payments LO - 0.4 Other quality management: National Accounts LO; CPI LO; Government Finance LO; Monetary O; Balance of Payments LO - Dimension 1. Assurances of integrity: - 1.1 Professionalism: all domains O - 1.2 Transparency: National Accounts LO; CPI LO; Government Finance O; Monetary O; Balance of Payments LO - 1.3 Ethical standards: all domains O - Dimension 2. Methodological soundness: - 2.1 Concepts/definitions: National Accounts O; CPI O; Government Finance LO; Monetary NA; Balance of Payments LO - 2.2 Scope: National Accounts O; CPI LNO; Government Finance LNO; Monetary O; Balance of Payments LO - 2.3 Classification/sectorization: National Accounts O; CPI LO; Government Finance LO; Monetary NA; Balance of Payments O - 2.4 Basis for recording: National Accounts LO; CPI LO; Government Finance O; Monetary LO; Balance of Payments LO - Dimension 3. Accuracy and reliability: - 3.1 Source data: National Accounts LO; CPI LO; Government Finance O; Monetary LO; Balance of Payments LO - 3.2 Assessment of source data: National Accounts LO; CPI LO; Government Finance LO; Monetary O; Balance of Payments O - 3.3 Statistical techniques: National Accounts LNO; CPI LO; Government Finance LO; Monetary O; Balance of Payments LO - 3.4 Assessment/validation: National Accounts LO; CPI O; Government Finance LO; Monetary O; Balance of Payments LO - 3.5 Revision studies: National Accounts LNO; CPI LO; Government Finance LO; Monetary NA; Balance of Payments LNO - Dimension 4. Serviceability: - 4.1 Periodicity/timeliness: National Accounts O; CPI O; Government Finance O; Monetary LO; Balance of Payments O - 4.2 Consistency: National Accounts LO; CPI O; Government Finance LO; Monetary LO; Balance of Payments LO - 4.3 Revision policy/practice: National Accounts LO; CPI LO; Government Finance LO; Monetary O; Balance of Payments LO - Dimension 5. Accessibility: - 5.1 Data accessibility: National Accounts LO; CPI LO; Government Finance LO; Monetary LO; Balance of Payments O - 5.2 Metadata accessibility: National Accounts O; CPI LO; Government Finance LNO; Monetary LNO; Balance of Payments LO - 5.3 Assistance to users: National Accounts LO; CPI LO; Government Finance LO; Monetary O; Balance of Payments O ### Box 1 — DQAF assessment in the absence of a central bank (key points) - Panama’s fully dollarized economy lacks a central bank; SBP compiles and disseminates banking sector statistics that do not conform to MFSM methodology. - Panamanian law does not assign responsibility to any agency to disseminate monetary statistics, which have broader coverage and a different analytical approach than banking sector statistics. - DQAF elements for monetary statistics not applicable in Panama include: - internationally accepted concepts and definitions for monetary statistics (e.g., net foreign assets, net credit to the government, broad money); - classification of financial instruments and sectorization by counterparty; - reconciliation by users with other statistical methodologies and data sources, although banking sector data are broadly consistent. ### Detailed, domain-specific findings and planned improvements (selected) - National Accounts (NA) - Base year: 1996; SUT prepared only for base year 1996; quarterly GDP in constant prices began publication in 2005. - Use of fixed ratios more than five years old affects 42 percent of estimated 2004 GDP at constant prices and 29 percent at current prices. - Quarterly GDP at 1996 constant prices — coverage for quarterly estimates: 93 percent of annual value added for the base year. - MIEA (Monthly Index of Economic Activity) available since January 2000 and covers 75 percent of GDP for the base year. - Planned improvements: change of base year, production of annual SUTs, surveys to monitor private final consumption, continuation of quarterly GDP at current prices. - Consumer Price Index (CPI) - New base: October 2002=100 for Urban and Other Urban National CPI; HIES 1997–98 used for weights but excluded households in lowest and highest deciles and one-person households. - CPI timeliness: published within 15 days after reference month. - Operational issues: missing prices imputed; quality adjustments limited; no PPI; WPI weighting base 1985. - Planned: HIES to be conducted in 2007–08 including top and bottom ten percentiles; consultancy to prepare PPI and WPI improvements. - Government Finance Statistics (GFS) - GFS compilation based on GFSM 1986; MEF and CG use diverse sources (accounting directorates, SIAFPA, DCP, DGT, DGI). - NFPS excludes PCA; some decentralized institutions compiled via sample and financing-only adjustments. - Timeliness: MEF quarterly reports within 45 days; monthly debt information within three weeks (24 days for December). - Planned: internal MEF/CG working groups, possible consultancy to facilitate GFSM 2001 migration. - Banking sector statistics (SBP) - Coverage: banks with general license represent more than 90 percent of depository corporations; finance companies and cooperatives not covered but considered of minor importance. - Valuation and recording: broadly consistent with MFSM valuation principles, but accrual accounting not fully applied (accrued interest often off-balance-sheet after arrears). - Dissemination: monthly aggregated data disseminated two months after reference month; source data received 10 working days after reference month; SBP published historical statistics from 1970 on request and planned methodological notes. - Planned recommendations: improve timeliness from two months to one month; make historical series from 1970 available; prepare methodological notes; establish mechanisms for private-sector consultation; revise reporting requirements to identify derivatives and insurance reserves. - Balance of Payments (BOP) — Controller General (CG) - Compiles BOP broadly in conformity with BPM5; exceptions: resident holdings of government bonds issued abroad not excluded; direct investment abroad not compiled. - Coverage gaps: CFZ transactions insufficiently recorded; private-sector services undercoverage (construction, professional, merchanting); compensation of employees and FDI abroad incomplete. - Timeliness: quarterly BOP and IIP exceed GDDS recommendations; quarterly BOP disseminated within one quarter after reference period. - Planned improvements: improve CFZ transaction data, compile public external debt on accrual basis, develop methodology to include unrecorded trade, standardize metadata in electronic and hard-copy publications. ### Policy recommendations (selected, from methodological soundness and domain assessments) - Banking sector (SBP) - Improve timeliness of disseminated banking sector aggregated statistics from two months to one month. - Make available historical series on banking sector statistics from 1970. - Establish formal mechanisms for consulting private sector users to identify new data requirements. - Avoid release of unpublished data to users before official dissemination. - Prepare and disseminate methodological notes describing financial sector characteristics and differences from international accounting standards. - Revise reporting requirements and chart of accounts to identify financial derivatives and insurance reserves and to distinguish depository corporations and other financial corporations. - Balance of payments (CG) - Improve scope of data sources for compiling construction, communication, professional and merchanting services, compensation of employees, and direct investment abroad. - Improve quality and timeliness of transactions data from the free trade zone, including goods procured in ports. - Compile public external debt data on an accrual basis. - Develop a methodology to include unrecorded trade in the balance of payments. - Standardize and continuously publish metadata in both electronic and hard-copy publications. - National Accounts and CPI - Update base year from 1996 and produce SUTs and annual balances for each year at current and constant prices. - Increase periodicity of HIES (current practice every 10–13 years) to at least every 5 years; pilot HIES planned in 2006 and main HIES in 2007–08. - Implement PPI and improved WPI series; improve price-collection procedures to collect prices on consistent dates and cover rural and excluded household groups. - Government Finance Statistics (MEF/CG) - Consider migration plan to GFSM 2001; implement recommendations from 2004 GFS mission (GFSM 2001 migration plan, expansion of institutional sample, full cash flow compilation for all institutions). - Exclude two financial institutions from general government where appropriate; adopt standard functional classifications consistent with GFSM. *Source: _cr06387 - The data module of the Report on the Observance of Standards and Codes (ROSC)_* ### 1. The data module of the Report on the Observance of Standards and Codes (ROSC) ### The data module of the Report on the Observance of Standards and Codes (ROSC) ### Overview and institutional setup - Panama has a well-developed macroeconomic statistical system; the legal framework assigns responsibility for socio-economic statistics to the Controller General of the Republic of Panama (CG), but the scope is not specified. - In practice: - The CG compiles and disseminates national accounts, consumer price index (CPI), fiscal, and external statistics. - The Ministry of Economy and Finance (MEF) compiles and disseminates fiscal statistics. - There is no central bank; the Superintendency of Banks of Panama (SBP) provides banking sector statistics aligned with its supervisory functions. - Long-standing dollarization and absence of a central bank mean monetary statistics concepts in the DQAF/MFSM are not fully applicable; several DQAF elements for monetary statistics cannot be applied (see Box 1). - Panama has participated in the GDDS since December 2000; metadata are regularly updated on the DSBB. ### Main data strengths and institutional dimensions - Legal/institutional and operational features: - CG: legal mandate (Article 280 of the 1972 Constitution; Presidential Decrees 7 and 194 of 1960 and 1997; Law 32 of 1984) to compile and disseminate national statistics; authority to request data from public and private entities; legal confidentiality protections; sanctions for noncompliance exist but nominal amounts outdated. - CG achieves de facto independence through professional tradition; staff are well trained and professional but face resource and remuneration constraints; heavy reliance on temporary staff in parts of the Directory of Statistics and Census (DSC). - MEF: authority over public finances and public debt information; staff size adequate and compensation above other public entities; high-quality computing and office resources; production legally protected from political interference. - SBP: designated agency for banking sector statistics; adequate staff size and competitive salaries; up-to-date computing equipment; legal independence; limited formal consultation with private users. - Commitment to statistical development: all agencies support implementation of the National Strategy for Statistical Development (NSSD) and engaged users in 2005 through five seminars and two surveys (producers and users). ### Methodological soundness and international standards - Broad conformity with international standards: - System of National Accounts 1993 (1993 SNA) - Consumer Price Index Manual, 2004 (CPI 2004) - Balance of Payments Manual, fifth edition (BPM5) - MEF follows A Manual on Government Finance Statistics, 1986 (GFSM 1986); no official commitment to migrate to GFSM 2001. - Noted shortcomings: - Quarterly GDP at constant prices (introduced in 2005) apply outdated input/output ratios from 1996; base year of 1996 is outdated. - CPI coverage excludes certain households (rural, one-person, lowest and highest deciles); methodological issues on missing prices and quality adjustments. - NFPS statistics exclude the Panama Canal Authority (PCA) and use only financing data for institutions not in the sample of non-budgetary institutions. - Monetary statistics concepts and definitions are not applicable to SBP banking sector statistics though scope and recording are broadly consistent with MFSM. - BOP shortcomings: recording interest on external public debt on a cash basis and not excluding resident holdings; not compiling FDI abroad. - Trade statistics compromised by source data problems from free trade zones. ### Accuracy, reliability, and source data issues - Accuracy and reliability are broadly adequate but require improvement across most datasets. - Specific data/source issues: - Price data collection sometimes not on the same date each month due to funding shortfalls. - The 2001 business register is updated only by adding new enterprises; it does not remove enterprises that have exited. - Household income and expenditure survey frequency: every 10 years. - Discrepancies between production and expenditure GDP estimates cannot be investigated because some expenditure components are not independently derived. - BOP surveys incomplete for some private-sector services and financial transactions (e.g., direct investment abroad). - Processes for assessment and validation of source data are needed; regular revision studies are not conducted except for major national accounts and CPI revisions. ### Serviceability and accessibility - Serviceability: - GDDS recommendations for periodicity and timeliness are met, and exceeded for: - GDP estimates (quarterly at constant prices) - CPI timeliness (15 days) - Public debt (disseminated monthly) - BOP and IIP (disseminated quarterly) - Timeliness of banking sector statistics should be improved given early availability of source data. - Statistics within datasets are generally consistent; some cross-dataset discrepancies exist without always providing explanatory notes. - Revision studies, when conducted, are not generally made public except for the CPI. - Accessibility: - Data are released to all users on a preannounced schedule, except for GFS flows disseminated by the MEF and banking sector statistics. - Summary metadata available in the GDDS; detailed methodology available only for national accounts, CPI, and BOP. - Unpublished non-confidential data are generally available on request but such availability is not publicized. - The CG publishes press releases and an advance release calendar; some legal framework details and methodological information are not posted on the CG website. ### User feedback and engagement - A mission user survey and meetings found: - Users consider macroeconomic statistics accurate and reliable and agencies professional and helpful. - Users use official websites, printed copies, and e-mail about equally. - Private industry and financial sector users desire greater periodicity and timeliness. - Users noted the need for better adherence to release/revision calendars and improved revision policy for fiscal statistics. - Agencies, particularly the CG, receive credit for providing additional breakdowns and explaining revisions on request. ### DQAF-based summary assessment (Table 1 — Summary results) Key to symbols: O = Practice Observed; LO = Practice Largely Observed; LNO = Practice Largely Not Observed; NO = Practice Not Observed; NA = Not Applicable - Dimension 0. Prerequisites of quality - 0.1 Legal and institutional environment: National Accounts LO; CPI LO; Government Finance O; Monetary LO; Balance of Payments LO - 0.2 Resources: National Accounts LO; CPI LNO; Government Finance LO; Monetary LO; Balance of Payments LO - 0.3 Relevance: National Accounts O; CPI LO; Government Finance O; Monetary LO; Balance of Payments LO - 0.4 Other quality management: National Accounts LO; CPI LO; Government Finance LO; Monetary O; Balance of Payments LO - Dimension 1. Assurances of integrity - 1.1 Professionalism: National Accounts O; CPI O; Government Finance O; Monetary O; Balance of Payments O - 1.2 Transparency: National Accounts LO; CPI LO; Government Finance O; Monetary O; Balance of Payments LO - 1.3 Ethical standards: National Accounts O; CPI O; Government Finance O; Monetary O; Balance of Payments O - Dimension 2. Methodological soundness - 2.1 Concepts and definitions: National Accounts O; CPI O; Government Finance LO; Monetary NA; Balance of Payments LO - 2.2 Scope: National Accounts O; CPI LNO; Government Finance LNO; Monetary O; Balance of Payments LO - 2.3 Classification/sectorization: National Accounts O; CPI LO; Government Finance LO; Monetary NA; Balance of Payments O - 2.4 Basis for recording: National Accounts LO; CPI LO; Government Finance O; Monetary LO; Balance of Payments LO - Dimension 3. Accuracy and reliability - 3.1 Source data: National Accounts LO; CPI LO; Government Finance O; Monetary LO; Balance of Payments LO - 3.2 Assessment of source data: National Accounts LO; CPI LO; Government Finance LO; Monetary O; Balance of Payments O - 3.3 Statistical techniques: National Accounts LNO; CPI LO; Government Finance LO; Monetary O; Balance of Payments LO - 3.4 Assessment and validation of intermediate data and statistical outputs: National Accounts LO; CPI O; Government Finance LO; Monetary O; Balance of Payments LO - 3.5 Revision studies: National Accounts LNO; CPI LO; Government Finance LO; Monetary NA; Balance of Payments LNO - Dimension 4. Serviceability - 4.1 Periodicity and timeliness: National Accounts O; CPI O; Government Finance O; Monetary LO; Balance of Payments O - 4.2 Consistency: National Accounts LO; CPI O; Government Finance LO; Monetary LO; Balance of Payments LO - 4.3 Revision policy and practice: National Accounts LO; CPI LO; Government Finance LO; Monetary O; Balance of Payments LO - Dimension 5. Accessibility - 5.1 Data accessibility: National Accounts LO; CPI LO; Government Finance LO; Monetary LO; Balance of Payments O - 5.2 Metadata accessibility: National Accounts O; CPI LO; Government Finance LNO; Monetary LNO; Balance of Payments LO - 5.3 Assistance to users: National Accounts LO; CPI LO; Government Finance LO; Monetary O; Balance of Payments O ### Box 1 — DQAF assessment in the absence of a central bank (key points) - Panama’s fully dollarized economy lacks a central bank; the SBP compiles and disseminates banking sector statistics that do not conform to MFSM methodology. - Panamanian law does not assign responsibility to any agency to disseminate monetary statistics, which have broader coverage and a different analytical approach than banking sector statistics. - Elements of the DQAF for monetary statistics that are not applicable in Panama include: - internationally accepted concepts and definitions for monetary statistics (e.g., net foreign assets, net credit to the government, broad money); - classification of financial instruments and sectorization by counterparty; - reconciliation by users with other statistical methodologies and data sources, although banking sector data are broadly consistent. *Source: _cr06387 - 1. The data module of the Report on the Observance of Standards and Codes (ROSC)_* ### 0. Prerequisites of quality ### 0. Prerequisites of quality ### Assurances of integrity — MEF and CG (general government finance statistics) - Legal and institutional environment - Laws give the MEF the mandate to produce government finance statistics; the Constitution gives the CG responsibility for the national statistics system. MEF and CG cooperate and are supported by legal regulations. - Meetings are held with respondents and users to facilitate collection of source data and improve use of published records. - Presidential Decree 7 of 1960 and the Transparency Law ensure respondent confidentiality. - Access to source data generation systems is direct and free flowing. - Resources - Staff are adequate for GFS production; compensation is better than average wages in public administration. - No staff assessment system in place. - Physical equipment, including computers, is of excellent quality; Internet access is limited. - Financial resources are sufficient to fully support statistical production. - No system for monitoring or enhancing efficient use of resources. - Relevance - Staff participate in workshops and seminars on GFS production relevant to users. - Specific procedure established by the Transparency Law to meet users’ requirements; user suggestions/comments are included in dissemination forms when relevant. - Other quality management - Awareness of quality importance exists, but no specific improvement program or system for quality measurement. - Compiling units assume initiative due to lack of institutional policy. - Assessments of annual processes are performed but focus on only one issue at a time. - No progress on implementing recommendations of the 2004 GFS mission (which included adoption of a GFSM 2001 migration plan, expansion of the institutional sample, full cash flow compilation for all institutions, and review of procedures for data collection improvement). - Professionalism - Strong culture of professionalism and independence supported by the Transparency Law and the Code of Ethics of Public Servants. - Decisions on collection, compilation and dissemination are governed by statistical criteria within resource limitations. - Producing units monitor possible errors in interpretation by users and provide advice/statements to correct misinterpretation in a timely manner. - Transparency - Legal standards regulating collection, compilation, and dissemination appear on the MEF website, but specific articles/sections supporting production of statistics are not identified. - Statistical information is delivered simultaneously to all interested parties, including executive and legislative authorities. - All statistical products clearly identify the producing unit, allocating responsibility and ownership in joint publications. - Use of figures is constantly monitored. Minor methodological changes have been reported in publications where incorporated; no important methodological changes in recent years. - Ethical standards - Transparency Law and the Code of Ethics of Public Servants establish standards protecting statistical production from political interference and guard against conflict of interest. - Strong organizational culture of respect for professional independence and probity favors application of legal standards. ### Assurances of integrity — Superintendency of Banks of Panama (SBP, banking sector statistics) - Legal and institutional environment - SBP is the official agency collecting, compiling, and disseminating banking sector statistics. - Legal basis for compilation and dissemination of monetary statistics is not clearly assigned to SBP or any other official agency. - SBP collaborates with international organizations (such as the IMF) to provide analytically useful monetary data, but these are not published in national sources following MFSM or the 1993 SNA frameworks. - Resources - Number of employees involved in monthly and quarterly statistics is adequate; salaries competitive with other public and private institutions. - Compilers use modern personal computers and adequate software. - Financial resources are broadly adequate for current compilation programs. - Workspace is less than adequate to facilitate efficient compilation. - Relevance - SBP obtains internal feedback through an annual evaluation and conducts periodic meetings (once a year) and regular telephone contacts with CG and MEF staff to improve quality and timeliness of reports required by them. - SBP does not have a proactive policy of regularly consulting private sector users. - Other quality management - SBP holds an annual meeting with all staff to improve productivity and user satisfaction; Economic Studies Department conducts detailed quarterly analyses of data quality. - Professionalism - Statutory provisions support SBP independence; Superintendent’s choice, tenure, and reporting arrangements are supportive. - Superintendent’s tenure is five years (Article 11 of Decree-Law No. 9 of 1998 (DL-9)); Directors’ tenure is eight years (Article 9). - Qualifications/requirements for hiring Superintendent and Directors are regulated in Articles 10 and 8; conflict of interest addressed in Article 12; removal addressed in Articles 14 and 15. - SBP comments on interpretation errors and misuse of statistics when necessary. - Transparency - DL-9 (available on the SBP website) contains terms and conditions for statistics collection, processing, and dissemination; Chapter VIII deals with banking sector reporting requirements. - All information produced by SBP is disseminated free of charge. - No government official outside SBP has regular access to banking sector statistics prior to web release. - Major changes to banking sector statistics are not always pre-announced. - Ethical standards - Clear guidelines for behavior in potential conflict of interest situations. - Article 12 of DL-9 regulates conflict of interests for Superintendent and directors. - Working Internal Regulation No. 14-98 of August 27, 1998 describes rights and obligations of SBP staff (Chapter 7) and sanctions for misconduct (Chapter 9); regulation is made known to staff on joining. *Source: _cr06387 - 0. Prerequisites of quality* ### 2. Methodological soundness ### 2. Methodological soundness ### Banking sector statistics (SBP) - Concepts and definitions - The framework, concepts, and definitions for monetary statistics are not applicable to the statistics on the banking sector disseminated by the SBP. - The balance sheet of banks under a general license (those that may conduct financial operations with residents and nonresidents) is the closest account to a depository corporations survey recommended by international statistical standards. - Scope - The scope of the data is broadly consistent with the guidelines of the MFSM. - Finance companies and saving and credit cooperatives are not covered in the banking sector statistics. However, the relative importance of the institutions not covered is very small. - Classification/sectorization and basis for recording - The classification of financial instruments and sectorization systems used for monetary statistics are not applicable to the statistics on the banking sector disseminated by the SBP. - Basis for recording is broadly consistent with the MFSM. - Market prices are used when possible. - Accrual accounting is largely applied, although some interest arrears are recorded off balance sheet. - Grossing and netting procedures follow largely the MFSM, although a consolidated statement of the banking sector is not disseminated. - Source data and assessment - Source data provide sufficient detail to identify financial instruments and counterpart sectors, and reasonably approximate the definitions, valuation, and time of recording recommended in the MFSM. - Although financial derivatives and insurance technical reserves cannot be identified, their relative importance is small. - Source data are timely. - Assessment of source data is sound. Balance sheets are routinely reviewed and banks consulted for clarification when unusual data movements are detected. - Statistical techniques and validation - Statistical techniques are generally sound. - The compilation process is mostly automated; electronic compilation procedures minimize compilation errors. - Assessment and validation of intermediate data and statistical outputs are conducted routinely. - Monthly information is validated against more detailed quarterly data when they are received. - Revisions, periodicity, and timeliness - Banking sector statistics are not subject to formal revision cycles in the statistical sense as data are deemed final when first released. - Periodicity and timeliness meet recommendations of the GDDS. - Timeliness of disseminated statistics could improve (from two months to one month) as prompt source data are available. - Consistency and comparability - Monetary statistics are consistent within the dataset and over time. - Historical series begin in 1970, but no data on the banking sector are readily available in electronic form before 1998. - Banking statistics are not reconcilable with other sectoral statistics because their analytical framework does not correspond to monetary analysis. - Revision policy and practice - A revisions policy for banking sector statistics is not needed because preliminary data do not exist. - The compiler only publishes the data that have been already validated and approved by the corresponding department in the SBP, which is final. - Data and metadata accessibility, and user assistance - Presentation of disseminated statistics is generally clear and meaningful. - Data are disseminated in PDF format, not in spreadsheets. - There is no pre-announced release schedule, but data are disseminated on the SBP website at regular intervals (monthly and quarterly). - Occasional longer than usual delays in dissemination have led some public sector users to obtain data before dissemination. - Users can obtain unpublished data on request, although this possibility is not publicized. - Methodological notes on banking sector statistics are not available, although the banking law available in the SBP webpage contains descriptions on classification of loans, securities, capital adequacy and other topics. - Assistance to users is provided on request in a timely manner (less than three days) through a contact point available on the SBP website. - Catalogues of publications are not needed because the SBP only publishes data on its website. ### Balance of payments statistics (Controller General—CG) - Concepts and definitions - The CG compiles the balance of payments statistics in broad conformity with the guidelines of BPM5, with the important exception that holdings by residents of government bonds issued abroad are not excluded from the financial account. - Scope - Coverage of the free trade zone is insufficient due to unrecorded transactions between free trade zone enterprises. - Unrecorded trade is not compiled. - Recording of some private sector activities is incomplete such as construction, professional, and merchanting services, as well as compensation of employees and direct investment abroad. - Classification/sectorization and basis for recording - Classification/sectorization are broadly in line with BPM5 guidelines. - Both analytic and standard presentations of the balance of payments and IIP are available in quarterly and annual publications of the DSC. - Basis for recording is mixed. - The principle of market valuation is generally used. - External debt is recorded at face value when issued, but adjusted to market value when redeemed. - Recording is mostly done on an accrual basis; however, interest on external public debt are recorded when paid. - Source data and assessment - The composition of data sources (surveys and administrative records) is adequate, although it does not cover some private sector services and financial transactions. - Difficulties in source data from the free trade zone do not ensure adequate trade estimates. - Accuracy of data from surveys is routinely assessed to monitor sampling and non-sampling errors. - A range of comprehensive checks for internal consistency are conducted and routine queries are made when large transactions take place. - Statistical techniques and validation - Compilation procedures for surveys and administrative records are sound and, in general, consistent with international practices. - Reconciliation of quarterly and annual data is done through simple procedures. - No comprehensive estimates of border transactions and smuggling are made. - Intermediate results are validated only when extreme values are observed. - Cross-checks/ verifications are insufficient with other administrative records available from government agencies. - Revisions, periodicity, and timeliness - Internal records are kept, but no formal analysis of revisions and their magnitude are conducted. - Periodicity and timeliness of balance of payments and international investment position statistics exceed recommendations of GDDS. - The revision cycle for balance of payments and international investment position follows a regular schedule, but it is not made known to the public. - Users are informed when data are preliminary or revised. No formal analysis of revisions are made public. - Consistency and comparability - Data are consistent within the dataset and over a reasonable period of time. - Financial transactions are reconciled with changes in the international investment position. - Statistics are reconcilable with other statistical sectors, although there are no explanatory notes addressing discrepancies. - Data and metadata accessibility, and user assistance - Data access is provided through the CG website and in hard-copy publications. - Statistics are released on a pre-announced schedule through a press release at the beginning of the year. - The statistics are made available to all users at the same time. - No specific reference is made in CG publications to the availability of unpublished sub-aggregates, even though these are available on request. - Metadata on balance of payments are available in biannual reports. CG website lacks this information. - Working papers or other specialized studies are not disseminated. - Prompt and knowledgeable service and support are available to users through the Integrated Correspondence System in DSC. - CG’s By-Laws regulate that a response to the user should be drafted within seven working days of receipt of the request. ### Policy recommendations (related to methodological soundness) - Banking sector (SBP) - Although meeting the GDDS standard, the timeliness of disseminated banking sector statistics (aggregated data) should be improved from two months to one month given the very early availability of source data and users’ request for more timely data. - Make available to users historical series on banking sector statistics from 1970. - Establish formal mechanisms for consulting private sector users to identify new data requirements. - Avoid the release, under any circumstance, of unpublished data to users before official dissemination on the SBP webpage. - Prepare and disseminate methodological notes describing the characteristics of the financial sector in Panama and disseminated data, particularly when concepts and definitions differ from international accounting standards. - Revise the reporting requirements and chart of accounts for banks to include the identification and sectorization of financial derivatives and insurance reserves, and distinguish depository corporations and other financial corporations in the sectorization of the accounts (currently banks and other). - Balance of payments (CG) - Improve the scope of data sources for compiling construction, communication, professional and merchanting services, as well as compensation of employees and direct investment abroad. - Improve quality and timeliness of transactions data from the free trade zone, including goods procured in ports. - Compile public external debt data on an accrual basis. - Develop a methodology to include unrecorded trade in the balance of payments. - Standardize metadata in both electronic and hard-copy publications and make them available on a continuous basis. *Source: _cr06387 - 2. Methodological soundness* ### 1. The Directory of Statistics and Census (DSC) of the Office of the Controller General ### The Directory of Statistics and Census (DSC) of the Office of the Controller General ### A. Institutional mandate and procedural remarks - The DSC is constitutionally responsible for “compiling and directing the national statistics”. - The DSC thanks the IMF for its comments on the quality of Panamanian statistics to guide required improvements. - Recommendation: use Spanish translations of documents when the DSC is requested to comment on future reports to ensure faster response and proper interpretation. ### B. Comments on the Quality of the Economic Statistics System - Since 2004 the DSC has conducted the National Strategy for Statistical Development (NSSD) at the regional level (Central America) to achieve full integration, efficiency and functionality of the National Statistics System (NSS). - Since 1997 there have been strategic plans for each administrative unit of the DSC, including a National Statistics Plan with budget lines for ongoing improvement. - Institutional modernization efforts: - Internal study with chiefs describing processes for each data series to detect missing or redundant processes. - Preliminary draft modernizing the law on national statistics (including penalties) developed and submitted to the Executive; hope to send to the National Assembly soon. - Rules in place that guarantee confidentiality, obligation to report, and ethical requirements for public servants. - Resources and capacity building: - Country has allocated own resources and international technical assistance; consultants hired and training provided domestically and abroad. - Commitment to IMF-recommended data dissemination rules and adherence to an advance release calendar; data accessible via the Internet and methodologies are transparent. - Meetings held through committees comprising producers, users, and data providers. - Operational limitations: - Most staff provided computer equipment and technical support is available, but updates and hardware at external administrative record sources are needed as detected by NSSD. - Logistical resource limitations: transportation for mobilizing technical personnel compiling statistical data. ### C. Improvements in Basic National Accounts and Balance of Payments Source Data - Business and survey updates: - Ongoing review and updating of the Statistical Directory of Businesses and Sites; design and content of questionnaires revised for national accounts and balance of payments needs. - Household surveys: - Household Income and Expenditure Survey to be conducted in 2007 to update household consumption patterns and levels; ROSC recommendations being considered to increase periodicity and provide private final consumption data more frequently than every 10 years. - National Household Income and Expenditure Survey (HIES) on employment conducted twice a year (March and August) starting this year: March uses multipurpose survey approach including other modules; August HIES examines manpower only. - The Household Income and Expenditure Survey (EIGH) to be conducted in 2007-08 will include households in the top and bottom ten percentiles. - Construction and trade indices: - From this year the Quarterly Construction Census will be carried out in urban areas of Panama City and San Miguelito based on horizontal cooperation with DANE (Colombia). - Joint effort with the Colon Free Zone (CFZ) Administration to improve quality and timeliness of CFZ data. - Implemented quarterly integrated indices of manufacturing industry (value, volume and price); consolidation of local (non-free zone) foreign trade indices (value, volume and unit value); CFZ indices to follow with international assistance. - Consultancy in producer price indices (PPI) planned for this year. ### D. National Accounts (NA) — methodology, coverage, and planned improvements - Methodological basis: - NA prepared on the basis of progressive implementation of the 1993 SNA with support of ECLAC-recommended consultants. - Recent and planned enhancements: - Progress: change of current base year 1996, obtaining a Supply and Use Table (SUT) for goods and services, improved source data, quarterly GDP, monthly index of economic activity (MIEA), progress with satellite accounts (tourism and environment), regional GDP, and sectoral breakdowns. - Penalties for failure to report data to be increased based on new preliminary draft of the statistics law. - Webpage content being corrected, updated and reorganized; mechanisms for improving online data consultation being implemented. - Targeted consultancy in April improved capture of data on production excluding taxes and other adjusted variables. - Satellite accounts on tourism advancing per interinstitutional agreement with Panamanian Tourism Institute (IPAT); surveys on incoming and outgoing tourism and a domestic tourism survey (ETI) to broaden analytical base. - Interinstitutional agreement with National Environmental Authority (ANAM) progressing towards establishment of satellite accounts on the environment. - Joint work with Ministry of Economy and Finance (MEF) towards first complete regional (provincial) GDP series. - DANE provided an international consultant for estimation of quarterly GDP on the demand side; work progressing and should be published in 2007. Plans to continue producing quarterly GDP at current prices. - SUT and chaining plans: - In present series (base 1996) only an SUT was prepared for the base year. - After NA consultancy last April to change the base to a more recent year, plans to produce an SUT and balances for each year at current and constant prices to provide more consistency. - Plans for surveys to monitor private final consumption. - Completed central frame of reference for the SNA with the integrated institutional sectors table. - Proposed further studies: trade margins and outlets, transport, downstream studies, changes in stocks, administrative concessions, improvements in allocation of Financial Intermediation Services Indirectly Measured (FISIM), permanent inventory, and chained indices. - Dissemination and metadata: - Consultant available by August to improve website presentation and access by users. - Since last May printed bulletins include list of direct contacts for publications. - Future publications will be posted on the Internet and existing metadata published by the IMF will also be posted on the DSC portal. ### E. Balance of Payments (BoP) — methodological changes and scope - Methodological alignment: - BoP statistics published since 1998 in accordance with the Fifth edition of the IMF Balance of Payments Manual (BPM5), with IMF-recommended consultants and related methodologies. - Website shows the International Investment Position. - CPIS and residency treatment: - Per ROSC methodological soundness comments, investments of residents in Panama are being excluded from these statistics starting this year. - Revised and implemented new form of the Coordinated Portfolio Investment Survey (CPIS) containing breakdown of investments by financial corporations at December 31, 2005. - Data from 2001-2005 obtained through CPIS will be included for the first time in the Balance of Payments and International Investment Position statistics, to be published in Panamá en Cifras this year. - Plans to include data on debt of private sector enterprises mainly from information declared by other participating countries in the CPIS available on the IMF website. - Scope and coverage improvements: - Participated in revision and capacity building for the Directory of Businesses improving concepts and definitions related to transactions in goods, services, assets and liabilities with the rest of the world. - Expect to capture transactions for enterprises providing/receiving telecommunications and computer services, direct investment from Panama abroad, professional services, etc. - Participated in design and training for the Construction Census to be carried out this year; it will capture services to/received from nonresidents and foreign direct investment in construction. - Meetings planned with Public Debt Directorate (MEF) to share methodology for recording and requesting details on interest due but not paid on external debt (government bonds). To date, BoP only records interest actually paid. - Coordination with Foreign Trade Section to address lag time in Colon Free Zone trade flow statistics; estimated to become current by October of this year. CFZ Administration advised to include needed staff in the 2007 budget. - Participating in drawing up incoming/outgoing tourism survey to be conducted in August to improve expenditure data by foreign residents in Panama and Panamanian residents abroad. - Domestic Tourism Survey (ETI) includes a question to obtain information on income received by household members who move to other countries to work for periods of less than one year to record the credit side of compensation of employees. - Plans to include methodology of these statistics on the institution’s website next month. ### F. Government Finance Statistics (GFS) - Implementation of GFSM 2001: - MEF invited to begin cycle of meetings to coordinate review of manuals, standards, compilation methodology, coverage, instructions and other tasks required to implement GFSM 2001. - Priority: highest government authorities, especially agencies managing fiscal information, must commit to beginning implementation of GFSM 2001. - Institutional actions: - Office of the Controller General formed internal working group that drew up an action plan identifying required items, feasibility/deadlines, offices in charge, and resources needed to implement GFSM 2001. - Two technical staffers recently attended a six-week course on the new IMF GFSM 2001. - A consultancy is considered advisable to expedite and facilitate implementation of GFSM 2001. - Other GFS recommendations: - Remaining recommendations (exclusion of two financial institutions from general government, adoption of functional expenditure classification format of GFSM 1986, expansion of institutional sample, full cash flow compilation for all institutions) could be analyzed and implemented subject to internal authorization. ### G. Consumer Price Indices (CPI) and price statistics - CPI base and coverage: - Prices and Cost of Living Section calculated the Urban and Other Urban National Consumer Price Index (CPI) with new base of October 2002 for the first time; previously index prepared only for districts of Panama City and San Miguelito. - Methodological choices: - Implemented international consultant’s suggestion to exclude from index weights the spending of households in the lowest and highest ten percentiles; exclude rents imputed to owner-occupied housing; and exclude home production of market goods for home final consumption. - Classifier for grouping goods and services in CPI is COICOP recommended by United Nations for 1993 SNA, with some variants for national reality and comparability. - Operational improvements: - NSSD work continuing; working committees with users to be formed starting 2007. - Coordinated with IT Statistics Services and solved problem of corrections to prices after calculation and maintained record of reasons for changes. - Publications now include list of contact persons with names of section heads and updated lists sent to users; work in progress on webpage accessibility and presentation. - When a price collector does not have the price for the current month, items in food and beverages division are estimated using the average of prices reported by other collectors. - Methodology for the HIES is being prepared along with publication of “Other Urban” data. - Survey inclusion: - Households in top and bottom ten percentiles will be included in results of Household Income and Expenditure Survey (EIGH) to be conducted in 2007-08. ### II. Ministry of Economy and Finance (MEF) — coordination and stance - Broad interest in enhancing quality of Panama’s statistical information evidenced by NSSD implementation, Fiscal Responsibility Law transparency adjustments, and assignment of working group at CG to develop migration action plan (CG letter dated July 14, 2006). - MEF view on GFSM 2001 migration: - Although “there is no official commitment to implement a plan to migrate to GFSM 2001,” current actions are believed to create the basis for future migration to GFSM 2001 and adherence to internationally accepted statistical practices. - CG publishes methodology documents explaining criteria for collection and compilation of national statistics. - Other recommendations (exclusion of two financial institutions from general government, adoption of GFSM 1986 functional classification, expansion of institutional sample, full cash flow compilation) can be analyzed and implemented if internally authorized. ### III. Superintendency of Banks of Panama (SBP) — banking statistics and metadata - Cooperation restated on banking statistics projects. - Report items highlighted: - Section 4.2 “Consistency” indicated no available data on the banking sector in electronic form before 1998. - Section 5.2 “Metadata accessibility” indicated that while the banking law on the SBP webpage contains descriptions on classification of loans, securities, capital adequacy and other topics, methodological notes on banking sector statistics are not available. - SBP actions and plans: - From April, 2006 and as requested by the IMF Consultant, published statistics from the year 1970 up to date on SBP web page. - Will publish a series of methodological notes related to Account Manual of the Balance Sheet, Income Statement, Credits by economic sectors and Investments by categories and titles. - Improving the official Account Manual as part of action plans for future statistical development. *International Monetary Fund — Detailed Assessments Using the Data Quality Assessment Framework (DQAF); Prepared by the Statistics Department; Approved by Lucie Laliberté and Guy M. Meredith; October 16, 2006.* ### 1. Data Quality Assessment Framework (July 2003): Summary of Results for ### Data Quality Assessment Framework (July 2003): Summary of Results for National Accounts ### 0. Prerequisites of quality — Legal and institutional environment - Legal instruments establishing responsibilities: - National Statistics Law of February 25, 1960 (Decree 7 (Article 1)); - Political Constitution of 1972 (Article 280, Section 1, Chapter 3); - Organic Law of the Office of the Comptroller General of the Republic of November 8, 1984 (Law 32, Article 11, Section 11 and Article 53); - Internal Regulations of the Office of the Comptroller General of the Republic of September 16, 1997 (Decree 194, Article 1). - Designated institutional roles: - Office of the Comptroller General of the Republic (CG) charged with “directing and compiling the national statistics.” - Directory of Statistics and Census (DSC) identified by Article 1 of Decree 7 as the body to exercise compilation tasks; Decree 69 of March 31, 1998 makes the DSC “responsible for directing and shaping the processes inherent to national statistics.” - National Income Section (NIS) of the DSC compiles, processes and disseminates national accounts; compilation carried out since 1946, although no law specifically assigns this responsibility. - Scope of compilation duties (as stated in law): - Activities relating to compilation, preparation, analysis and publication of statistics by official bodies (Article 2 of Decree 7). - Processes for collection, preparation, analysis and publication of quantifiable national or regional data (Article 53 of Law 32). - Institutional coordination mechanisms: - Internal controls cover survey design through use in macroeconomic statistics. - External coordination via committees with public and private sector representatives; national accounts committee: Interagency Technical Committee on the National Accounts (ITCNA). ### 0.1 Specific assessments of legal/coordination features - Resolution of data-access conflicts: - Past conflicts (e.g., with the Banking Act or Regulatory Body for Public Services, ERSP) resolved through negotiated access to aggregate data that prevent identification of individual reporters. - No conflict of interest in access to tax information reported. - Data sharing and coordination adequacy: - Article 54 of Law 32: CG shall “direct and coordinate the statistics produced by public entities.” - Article 11 (11) of Law 32 authorizes the CG to “create the necessary technical committees to improve the national statistics.” - Flow of core information: timely and efficient for most DSC surveys; DSC’s position within the CG facilitates access to government accounting information. - DSC performs regular controls of incoming information to guarantee efficiency and timeliness. ### 0.2 Confidentiality protections and access controls - Legal confidentiality provisions: - Individual data are “strictly confidential” (Article 12 of Decree 7; Article 125 of Decree 194). - Article 54 of Law 32: “the Comptroller’s Office must maintain the secrecy and confidentiality of the information obtained.” - Article 13 of Decree 7: individual data “may not be produced in court and may not be used for purposes of tax collection, for judicial investigations, or for any purpose other than those of a statistical nature.” - Article 13 of Law 6 (Transparency Act of January 22, 2002) contains provisions to maintain confidentiality if confidential information is part of judicial proceedings. - Communication to reporters: - Circulars and survey headings inform reporters their information is confidential (reference to Decree 7 of February 25, 1960). - Questionnaires include notes on purpose, and contact details (telephone numbers, names and e-mail addresses) to assist respondents. - Institutional duty and sanctions: - Article 78 of Decree 194 requires CG personnel to “respect the required confidentiality of information.” - Article 14 of Decree 7: employee who discloses confidential information “shall be dismissed from employment.” - Article 86 (g) of Decree 194 and Article 125 provide similar grounds for dismissal and definitions of disclosure. - Operational confidentiality safeguards: - Access restricted to supervisors of each coordination group; databases controlled via secret keys. - Reporting forms stored in DSC offices or dedicated warehouse with restricted access. - Written information destroyed after five years (by shredding or incineration). - For universes with fewer than three reporting units, only aggregated information may be published or provided, except with written authorization of reporters; such data are aggregated to similar category or “others” (Article 125 of Decree 194). - When investigations require individual records, DSC processes and delivers aggregated results (e.g., by activity classification groups) to preserve confidentiality. - Physical and IT security: - Access to the CG controlled by identification cards and a security force of around 30 persons located in strategic areas. - National Computerization Directorate responsible for data security; Department of Computerized Statistical Services (DCSS) responsible for handling computer program problems. ### 0.3 Statistical reporting mandate and response encouragement - Legal reporting obligations: - Article 54 of Law 32: CG “shall request information for statistical purposes from public and private entities or persons. Such entities and persons must supply the information so requested.” - Article 1 of Decree 7 confirms underlying legal authority for data collection. - Article 8 of Decree 7: “all dependencies of the State, legal persons domiciled in Panama or conducting business there, and natural persons within the national territory must provide the data and reports requested for compiling the national statistics,” except where restricted for national security. - Sanctions for noncompliance: - Article 9 of Decree 7: Heads of public offices and other persons who fail to supply data, or who deliberately or through extreme negligence provide false information, are liable to a fine of B/ 5-100. - Payment of the fine does not exempt the person from the obligation to provide true reports and data. - Practical note: the amount of fines has not been updated since 1960 and there is no mechanism for updating it (for example, using the CPI); for the most part, the fines are not applied in practice. - Measures to improve response and reduce burden: - DSC efforts have eliminated duplication of requests and excessive reporting burdens that existed until a few years ago. - Survey design accounts for reporters’ terminology and uses logical question sequencing to facilitate response. - When surveys are not completed by DSC staff, forms include assistance contacts; questionnaires accompanied by explanatory notes and, in some cases, published statistical documents to demonstrate how information is used. *Source: Data Quality Assessment Framework (July 2003): Summary of Results for National Accounts (extracted text).* ### 0.2 Resources ### _cr06387 - 0.2 Resources ### 0.2 Resources — staff, facilities, computing resources, and financing - Staffing complement and status - In theory, the NIS has a staff complement of 31 positions, of which 28 are filled and three are vacant. - Of those 28 persons, 18 are permanent employees and 10 are on contract. - Technical staff qualifications: - Technical staff with Bachelor’s or higher degree: 13 permanent, 10 contract, Total 23 - Technical staff with no university degree: 4 permanent, 0 contract, Total 4 - Assistants: 1 permanent, 0 contract, Total 1 - Total: 18 permanent, 10 contract, Total 28 - Qualification summary: about 85 percent have a bachelor’s degree or higher (Master’s or doctorate). - Staffing adequacy: staffing level is considered somewhat low for tasks such as updating the base year, balancing annual supply and use tables by product, or producing institutional sector accounts. - Average length of service: 15 years. - Salaries and contract pay - Salaries for permanent staff are not competitive within the public administration as a whole. - Contract staff receive remuneration that is 30 percent to 40 percent below that of their permanent staff counterparts in similar positions. - Years of service distribution (staffing complement by years of service) - Counts: - 0–5 years: Permanent 1, Contract 6, Total 7 - 6–10 years: Permanent 3, Contract 4, Total 7 - 11–15 years: Permanent 3, Contract 0, Total 3 - 16–20 years: Permanent 0, Contract 0, Total 0 - More than 20: Permanent 11, Contract 0, Total 11 - Total: Permanent 18, Contract 10, Total 28 - Percentages of total: - 0–5: Permanent 3.6, Contract 21.4, Total 25.0 - 6–10: Permanent 10.7, Contract 14.3, Total 25.0 - 11–15: Permanent 10.7, Contract -, Total 10.7 - 16–20: Permanent -, Contract -, Total - - More than 20: Permanent 39.3, Contract -, Total 39.3 - Total: Permanent 64.3, Contract 35.7, Total 100.0 - Training and performance incentives - A training committee oversees continuous training for personnel; an annual training program is available to all staff. - The performance appraisal awards 30 percent of the overall score for professional development efforts. - Task rotation is encouraged within the NIS to improve staff motivation. - Computing resources and IT access - The unit has 27 Pentium IV computers and two printers. - Memory capacity is adequate for handling the databases. - There is a general server and a database that affords prompt and secure access. - Computer programs for compiling and analyzing statistical series are adequate. - Access to the Internet and open e-mail is limited to senior employees. - Computer resources are protected; the DCSS performs daily backups of all data in the national accounts server. - Office space, furnishings, and transportation - The office has a floor area of 150 m², or an average of 5.4 m² per person, which is inadequate. - There is no proper meeting room. Offices are well lit and have air-conditioning. - Office furnishings and equipment are adequate for ongoing activities, although considered outdated. - Transportation services for data collection are not adequate; means are frequently unavailable and the situation is often resolved through issuance of taxi chits for staff travel. - Financing and planning - Funding is inadequate to cover all the needs of the statistics program, and the budget is subject to frequent cuts that impact planned activities, in particular, conduct of the surveys. - A strategic five-year plan is prepared in coordination with the rest of the DSC to facilitate planning of statistical improvements. ### 0.2.2 Measures to ensure efficient use of resources - Performance appraisal and pay links - Permanent staff are subject to annual appraisals in which performance accounts for 70 percent and professional development for 30 percent. - Performance evaluation classifications: excellent, good, satisfactory (“regular”), and poor. - “Excellent” ratings are not limited to any quota. - Appraisal scores are averaged every two years; if positive (excellent, good or satisfactory) a biennial salary increase is awarded based on job level and a pre-established pay scale that is public knowledge. - A good performance rating will not translate into a salary increase if the employee has not taken a professional development course. - A poor annual appraisal constitutes a warning and in extreme cases may be grounds for dismissal. - Contract staff are evaluated on the same terms as permanent staff, but the results have no consequences for their pay. - Quarterly appraisals are now being considered. - Internal coordination and external expertise - Internal working meetings are held to review the efficiency of work processes; mandated by Article 17 of the Internal Regulations of the CG to meet at least once a month. - The NIS frequently resorts to international experts to evaluate and implement compilation systems (recent examples: quarterly GDP estimates and annual accounts with ECLAC assistance; preparation of a program for benchmarking and seasonal adjustment with World Bank financial assistance). - In previous years (1997 and 2001), technical assistance was requested from the IMF. - Cost monitoring - The costs of compiling the statistics can be identified through the annual budget, but they are not regularly assessed, monitored, or compared with other statistical programs. ### 0.3 Relevance — user consultation and statistical strategy - User consultation mechanisms - Data users are consulted and kept informed on specific aspects of current data through a formal mechanism, the ITCNA, which meets prior to each new census or survey. - The DSC has the National Strategy of Statistical Development (NSDD), created in 2003 within the Central America regional framework by PARIS21 and receiving funding from the World Bank. - General objective of NSSD in Panama: “to adopt a national strategy among statistics producers, users and partners to develop Panamanian statistics.” - Through NSSD, the DSC has conducted opinion surveys of users and suppliers of statistical information in the public and private sectors. - Outreach and participation - Recent activities: “Seminar on National Accounts for Users and Suppliers” (one week, October 2004) and participation in annual conferences of the Faculty of Economics of the University of Panama. - NIS staff regularly take part in statistics meetings and seminars organized by international and regional agencies, in particular ECLAC and the National Statistics Institute (NSIS) of Spain. ### 0.4 Other quality management - Quality focus and planning - Improving the quality of service is one of the principal objectives of the DSC, as confirmed in its Strategic Five-year Plan. - Staff seminars foster appreciation for evaluating statistical product quality using statistical techniques for detecting extreme points and checking consistency of basic information from various sources. - A program to assess quality is not in place. - Past attempts to establish a Total Quality System were discontinued (Sistema de Calidad Total, delivered by the IMMECA Group of Mexico, in 1997). - Working methods resulting from past efforts are in place for achieving quality; ITCNA and NSSD demonstrate intent to foster quality. - Quality monitoring processes - Statistical quality is systematically monitored through the submission of monthly activity reports by the NIS detailing work performed, response to users’ requests, and the training program. - The NIS makes efforts to update its estimation methods (examples: updating of the base year and dissemination of quarterly estimates). - There are no quality monitoring procedures in place to inform management on quality achieved using reporters’ response rates or editing rates. - The NIS has a long tradition of hiring experts to provide advice on statistical quality. - Quality considerations in planning - Quality issues are considered in planning the statistical program, including improvements identified during ongoing monitoring and periodic reviews, information on quality standards, and emerging user requirements. - Quality improvements constitute one of the objectives of the Strategic Plan 2005–2009. - The NIS considers the trade-off between timeliness and accuracy/reliability of the data and advises users whether data are estimated, preliminary or revised. ### 1. Assurances of integrity — Professionalism, transparency, and ethical standards - Professional independence and legal provisions - Article 1 of Law 32 guarantees the professional independence of the CG, defining it as “an independent government agency of a technical nature.” - Article 4 of Law 7 gives the CG powers including: - (a) To request that any statistical research not be undertaken or be suspended to avoid duplication; - (b) To request changes in forms, definitions, classifications and instructions used for collecting statistical data; - (c) To issue an opinion on statistical publications. - Article 4 provides that requests from the Office of the Comptroller General in sections (a) and (b) have mandatory force for the office to which they are addressed. - There is no law stipulating the length of tenure of DSC managers, but appointment and removal mechanisms are applied in ways that support professional independence. - Article 35 of Decree 7: the DSC “shall be headed by an employee to be known as the Director of Statistics and Census, who must be a Panamanian citizen with a background and training in statistics and the capacity to perform executive functions.” - Recruitment, promotion, and authorship - Staff are hired on the basis of profiles; Article 22 of Decree 194 prescribes recruitment and selection procedures including analysis of background, testing, and interviews; the Human Resources Director provides a shortlist to the selection committee. - Promotions are awarded in accordance with the performance and professional development appraisal. - The training committee evaluates and plans training in-country and abroad. - While there is a policy for continuous training, authors of methodological papers are not identified in DSC publications (which may discourage research); authors may record research with the Human Resources Directorate for appraisal credit. - Choices and dissemination - Choices of sources, statistical methodologies, and dissemination decisions are based on measurement objectives and data requirements; cost considerations also influence selection. - Dissemination decisions are informed solely by statistical considerations pursuant to Article 13 of Law 7. - Commenting on misuse - Information is made public through press releases with explanatory commentaries to prevent interpretation errors by journalists. - The DCS of the CG monitors daily media coverage and, if it finds a significant error of interpretation, issues clarifications in the form of a press release signed by the Comptroller General or the Director of the DSC. - Transparency and access - Terms and conditions under which statistics are collected, processed and disseminated are not available to the public on the DSC web page. - The DSC provides information through public statements and meetings; publications do not always indicate where further information can be obtained on the entity responsible for preparing the data. - Internal governmental access: the government has access to the statistics at the same time as other users. - Identification of statistical products - All statistical products are clearly identified with the DSC logo. In joint publications, each entity’s part is identified by its logo. When its data are used by another agency, the DSC requests that the source be identified. - Advance notice of methodological changes - When major changes are introduced in methodology and data sources, notice is provided at the time the series is released, but not in advance; in some cases they are reported in national accounts seminars. - Ethical standards - Staff are subject to the ethical guidelines established in Executive Decree 246 (December 15, 2004), establishing the Uniform Code of Ethics for Public Servants, and CG Decree 194. Both documents are given to all staff of the CG and rules of conduct are posted in visible places. Rules cover “Our 10 Commandments,” “Our Duties,” and “Restrictions.” Staff are reminded of ethical standards at working meetings and through memorandums. ### 2. Methodological soundness — Concepts and definitions; Scope - Concepts and definitions - The 1993 SNA was adopted in 2004, at which time the year 1996 was established as the new base year for the national accounts. - Scope and coverage - The 1993 SNA tables and accounts that the ISWGNA determined as minimum requirements are compiled on a regular basis: - annual value-added and GDP at current and constant prices by activity; - annual expenditure of GDP at current and constant prices; - annual value-added components at current prices by activity; - sequence of accounts for the total economy (until net lending) with an annual frequency; and - annual rest of the world accounts (until net lending). - The 1993 SNA tables and accounts that the ISWGNA determined as recommended are not fully compiled and only include quarterly value-added and GDP at constant prices by activity. - Not compiled: - quarterly value-added and GDP at current prices by activity; - quarterly expenditure of GDP at current and constant prices (planned for implementation in 2006); or - annual supply and use tables (only for the base year 1996). - Coverage of constituents and production boundary - Dissemination of constituent units of the economy is partially in accordance with 1993 SNA guidelines. - Coverage includes the Colón Free Zone (CFZ) and the Petroleum Free Zone, but does not include the remuneration of persons working abroad (in particular those working in Costa Rica and Colombia). - The production boundary includes: - own-account production of all goods for own final consumption (in particular farm production); - output of goods for own-account fixed capital formation (compiled through the survey of nonfinancial businesses, SNB); - production of computer software (surveyed in the SNB); and - illegal output sold to willing buyers: diversions from the CFZ to the rest of the country are measured. Other illegal output is not explicitly measured, although it is measured implicitly through inclusion in GDP for the base year, because the underground economy was incorporated into the 1996 base. - Exclusions from production measurement: the production of literary or artistic originals, research and development for own account, and mineral exploration are not included because they are not deemed important in the country. - Assets boundary - The assets boundary is partially in accordance with the 1993 SNA; it includes only agricultural work in progress. - Items that should be included but are currently excluded: financial leasing and computer systems and programs and databases (purchased or built in-house), which could be of some importance. - Defense-related assets usable for civilian purposes are considered of little importance and are excluded, as are valuables and historical monuments, entertainment, literary or artistic originals, patented entities and mineral exploration. *Source: _cr06387 - 0.2 Resources* ### 2.3 Classification/sectorization ### 2.3 Classification/sectorization ### 2.3.1 Classification/sectorization systems used are broadly consistent with internationally accepted standards, guidelines, or good practices - The classification and sectorization used for compiling the national accounts are generally in accord: - the 1993 SNA is used to classify institutional units and transactions; - the International Standard Industrial Classification (ISIC) Rev. 3 is used to classify economic activities, through its Panamanian adaptation, the National Standard Industrial Classification of All Economic Activities (ISICF); - the Central Product Classification (CPC) Rev. 1.0 Prov. is used to classify products, in its national adaptation, the National Classifier of Goods and Services; - the Classification of Individual Consumption by Purpose (COICOP) is used to classify household consumption; and - the Classification of Functions of the Government (COFOG) is used to classify the functions of government. - The 1993 SNA is not used for other flows, except for government and financial corporations. - Imports and exports of goods are classified by economic use or destination (CUODE). ### Notes and observations contained in the source text - Footnote material indicates specific survey and valuation issues: - An estimate is based on comparing sales figures and changes in inventories that CFZ firms declare in the SNB, and foreign trade figures (imports and re-exports). This approach assumes that CFZ firms import goods, which they declare to customs, but which instead of being re-exported are sold on the domestic market in Panama. - Chapter VII, Purchases and Expenditures, of the SNB asks for data on the value of financial leases, disaggregated into principal and interest. However, firms have had difficulty in answering this question, and the response rate is low. - Although this is explicitly measured in output, there is no indication on the demand side in the SNB table of assets. --- ### 2.4 Basis for recording ### 2.4.1 Market prices are used to value flows and stocks - Surveys do not specify that sales must be valued exclusive of product taxes and subsidies; consequently, in some activities output is measured at producer prices or even at market prices, instead of at basic prices. - Some reporters may include the goods and services transfer tax (GSTT, the local name of the value-added tax) in their value of output, although DSC survey administrators take care to ensure that these are excluded from sales declarations. - Output for own use is valued at equivalent market prices, where the information sources so permit. - If they are not deductible, sales and excise taxes are included in the valuation of intermediate consumption. - Surveys do not mention that the reporter must exclude the deductible portion of the GSTT when valuing purchases; this may produce distortions in the valuation of intermediate consumption of nonexempt activities or products, which will then be valued at market prices instead of purchaser’s prices. - The same observation applies to the valuation of final uses, which should exclude the deductible portion of the GSTT, a fact not mentioned in the surveys. - No corrections are made for transfer prices, since the enterprise, as opposed to establishment, is the statistical unit of measurement in the surveys; no breakdown of output and intermediate consumption by production site is requested in the surveys. - Information on insurance and freight is available for merchandise imports, calculated by the Foreign Trade Section (FTS). Total imports and exports are valued on an FOB basis. - Transactions in foreign currency are converted to the national currency (the balboa) at the prevailing exchange rate, which is one balboa to one U.S. dollar. ### 2.4.2 Recording is done on an accrual basis - Transactions and flows are recorded on an accrual basis, with the exception of government revenues, taxes and certain external operations (interest on the public debt and payments of dividends), which are recorded on a cash basis. - Work in progress (farm crops and construction) is recorded in the period it is produced. ### 2.4.3 Grossing/netting procedures are broadly consistent with internationally accepted standards, guidelines, or good practices - Grossing and netting procedures are not in accordance with the 1993 SNA. The firm is surveyed, not individual production sites within the same enterprise. - There are few firms engaged in multiple activities, implying that there are no significant transactions at transfer prices. - Consumption of fixed capital is estimated so that macroeconomic aggregates can be estimated in net/gross figures. *Source: _cr06387 - 2.3 Classification/sectorization* ### 3.1 Source data ### _cr06387 - 3.1 Source data ### Overview: source data and collection programs - Source data are obtained from comprehensive data collection programs that take into account country-specific conditions. - Annual and quarterly collection programs used to compile statistics for the national accounts are described as reasonably adequate. - Principal data sources: (i) business surveys; (ii) household surveys; (iii) government finance statistics; (iv) administrative records; (v) censuses, special studies and accounting statements; and (vi) price statistics. ### Business surveys: coverage, frames, and processing - Annual surveys are performed by the Economic Surveys Section (ESS) of the DSC and include: - SNB (module for manufacturing, construction, and mining and quarrying); - Survey of nonfinancial businesses: CFZ (SNB-CFZ); - Survey on the financial progress of construction works (EAFOC); - Farm surveys (EA): rice, corn and beans; - Livestock surveys (EP): poultry, cattle and swine. - Coverage adequacy: - Coverage of annual surveys for nonfinancial business activities is adequate, excluding only: agriculture (except rice, corn and beans); animal husbandry (except poultry, cattle and swine); hunting, forestry, and fishing; electricity and water supply; transportation (except air transport); private education; private healthcare; business and personal services. - Sample frame and registry: - SNB sample frame based on business directory relying on the 2002 Economic Census (EC 2002, with data from 2001). - Regular updating of the business directory was suspended in 2003 for budgetary reasons; since then the administrative register of the Ministry of Economy and Finance (MEF) has been used. - The MEF registry captures formally added new units but does not delete defunct ones. - Sample frame not updated for budgetary reasons; an update was planned for 2006. - Stratification and sample: - Population of firms representative nationally (ISIC coverage at the four-digit level) and regionally (ISIC at the two-digit level). - Divided into two strata: firms with sales exceeding B/ 5 million, and firms with lower sales figures. - Universe includes firms with more than five employees. - Annual (and quarterly for some activities) estimates based on results from 1500 firms sampled from a total of about 22,000. - Quality control and processing limitations: - Sample selections are not assessed regularly; relative sample error not calculated. - No regular examination of population benchmarks or of weightings used in estimation, primarily because of lack of computer resources (programs with official licenses). - Survey questionnaires follow sound design principles and pilot testing, but proposed amendments are not always subject to preliminary tests. - Data are sufficiently detailed to cover main national accounts aggregates (output, intermediate consumption, fixed capital formation, and changes in inventories). ### Household surveys: periodicity, frames, and limitations - Key household surveys and status: - National Household Income and Expenditure Survey (HIES): most recent conducted May 1997–April 1998; covered only urban population; periodicity 10 years. - Living Standards Survey (LSS): conducted May–August 1997. - Households and Employment Survey (HES): conducted annually (in August); two surveys planned for 2006 covering urban and rural populations for population and employment estimates. - Sample frame and design: - HES sample frame: 2000 National Population and Housing Census (NPHC 2000), updated for new housing construction (based on building permits and monitoring of informal construction). - Probability-based sampling: probability of selection of households is known; urban sample two-stage, rural sample single-stage. - Sample covers 13,400 dwellings (universe of households according to NPHC 2000 is 681,928); conducted in all provinces (Province of Panama subdivided into three districts). - Planned rotation of 25 percent of dwellings in each survey. - Processing limitations: - Sample statistics are not upgraded for response errors because of lack of software. ### Government finance statistics - Complete monthly government finance statistics available from a database provided by the MEF. - Off-budget funds surveyed for decentralized agencies (Social Security Fund, universities, hospitals, institutes etc.) based on financial statements submitted to the NIS. - Local government operations recorded through budget execution reports. - All defense-related expenditures by the National Air Service and the Navy are recorded. - No data on capital stocks. - Detailed data available to measure output, intermediate consumption, fixed capital formation, and final consumption expenditure of government services. ### Administrative records, censuses, and special studies - Administrative records received by the NIS include: - Income tax filings database from the Department of Revenues (DGI); - Building permits for 39 municipalities; - Monthly financial statements from the Superintendency of Banks (SB) and quarterly statements from the Superintendency of Insurance (SS); - Commercial vehicle registrations from municipal treasuries; - Health statistics from the Medical and Statistics Records Section of the Ministry of Health; - School enrollment from the Statistics Department of the Ministry of Education. - Foreign trade database from the General Directorate of Customs (DGA) is processed by the FTS of the DSC and transmitted to the NIS. - Censuses available: NPHC 2000, CE 2002 and National Farm Census 2000 (CNA 2000). - Special studies cover farming, livestock, forestry and artisanal fishing. - Ministry of Agricultural Development (MAD) provides data on area planted, harvest and yield for main crops. - Accounting records include financial reports and statements of earnings for activities such as electricity and water supply, construction and transportation compiled directly from businesses. ### Price statistics: limitations for constant-price estimation - No Producer Price Index (PPI). - Wholesale Price Index (WPI) weighting base is seriously out of date: 1985. - Consumer Price Index (CPI) weighting base: 1996/1997 with a benchmark of October 2002 = 100. - Two monthly agriculture price series: - Prices Received by Farmers (PRPA) — cover 26 crops and 5 livestock products. - Prices Paid by Farmers (PPPA) — survey prices of main farming inputs and prices for live cattle and swine. - NIS receives monthly price index for apparent consumption of construction materials and labor prepared by the Panamanian Construction Bureau (CAPAC). - No foreign trade price indices or index of wages and salaries. - SIN is making estimates based on unit values of foreign trade; DSC has launched studies expected to publish export and import indices shortly. ### Assessment of principal sources and coverage (annual and quarterly) - Interpretation of evaluation ratings: - “good”: component coverage is broad. - “reasonable”: coverage could be improved but is still appropriate. - “regular”: coverage could be improved with available sources. - “poor”: low coverage. - “inappropriate”: indicator not significantly related to component observed. - “unsatisfactory”: indicator related but a substitute for the correct one. - Production approach annual sources generally rated Good across many ISIC Rev. 3 sectors (examples listed in source tables). - Expenditure approach shows coverage problems in several categories; several components rated Poor or Inappropriate (examples listed in source tables). - Specific numerical coverage statements: - Quarterly estimates of GDP at 1996 constant prices began publication in 2005. - Coverage for quarterly estimates: 93 percent of annual value added for the base year. - MIEA (Monthly Index of Economic Activity) available since January 2000 and covers 75 percent of GDP for the base year. ### Quarterly compilation: sources and adequacy - Quarterly sources correspond generally to annual sources; coverage for quarterly GDP sources evaluated as adequate. - Special quarterly survey: Quarterly Employment, Sales and Output Survey (QESOS) by ESS covers manufacturing, wholesale and retail trade (excluding the CFZ) and some services (Radio and television, laundry and dry-cleaning, and hairdressing). - Limitations noted: - No quarterly estimates at current prices. - Expenditure components are not compiled on a quarterly basis. ### Data consistency, classification, and timeliness - Source data reasonably approximate definitions, scope, classifications, valuation, and time of recording required for national accounts. - Business accounting records governed by international standards since 2001, using standard charts of accounts on an accrual basis. - Fiscal year usually coincides with calendar year; in cases where it does not, source data are not adjusted to the calendar year. - Government chart of accounts established by the CG: government spending recorded on an accrual basis and revenues on a cash basis; information can be reclassified to meet 1993 SNA needs. - Permanent and seasonal crops estimated from MAD and DSC sector surveys (EA for farming and EP for livestock)—information on output, stocks, and harvest/seeding calendar provided. - Coverage of economic activities in data sources is reported as good, embracing more than 80 percent of value added (see source tables). - Timeliness: - Data collection and processing timetables are adequate to meet timeliness and periodicity for national account dissemination. - Business surveys, price surveys, and data on government, banking activity, and the balance of payments are received on time. - Import statistics are received punctually in provisional form but may undergo significant changes when definitive data are received. *Source: _cr06387 - 3.1 Source data.* ### 3.2 Assessment of source data ### 3.2 Assessment of source data ### 3.2.1 Assessment of source data and monitoring - Source data (censuses, sample surveys, administrative records) are routinely assessed for coverage, sample error, response error, and nonsampling error; results are monitored and made available to guide statistical processes. - No information is available about sampling errors or nonsampling errors in the surveys. - There is no regular monitoring of information on sampling errors for each survey, for budgetary reasons. - A plan exists to check consistency of survey data, analyze inconsistencies, and assess accuracy of reporters’ responses, including consistency checks against other sources, particularly tax sources. - Material changes from data updates are incorporated into national account statistics according to an established revision cycle. - Extreme values are confirmed with respondents and corrected in case of error. ### Main findings on source-data assessment - No regular reporting/monitoring of sampling-error information for each survey. - Consistency checks are planned and include tax source comparisons. - Revision cycle and respondent confirmation procedures are in place for extreme values. --- ### 3.3 Statistical techniques ### 3.3.1 Data compilation techniques and nonresponse - Data compilation procedures identify abnormal values and investigate them with the direct source. - Nonresponse adjustment procedure: repeat response from the immediately preceding year (not soundly based). - More appropriate techniques suggested: trend projections or changes in the benchmark population. - The nonresponse ratio is low. ### 3.3.2 Other statistical procedures (unobserved activities; asset transfers; FISIM) - Unobserved activities: - Included in base-year GDP through preparation of output accounts by economic activity for unincorporated businesses (households). - Adjustments were made to output from wholesale and retail trade, restaurants, hotels, education, health, and other community, social and personal services. - These adjustments amount to 20 percent of GDP for base year. - Adjustments do not explicitly include measurements of hidden or illegal activities. - Assets transferred to Panama (1997–1999): - United States Government transferred an area of approximately 1400 km², covering a band 8 km wide along each side of the Panama Canal. - Non-produced nonfinancial assets (lands and properties) and produced nonfinancial assets (dwellings, other buildings, machinery and equipment) were transferred to the Panamanian government. - The NIS recorded the transfer in the “other changes in the volume of assets (OCVA)” account; this treatment is regarded as inappropriate. - According to 1993 SNA guidance, recording should include: - A capital transfer in kind received by Panama for the total value of the nonfinancial assets transferred, to be recorded in the capital account with the rest of the world. - An acquisition of non-produced nonfinancial assets for the total value of the non-produced nonfinancial assets received (lands and properties), to be recorded in the capital account with the rest of the world. - An import of services for the value of the produced nonfinancial assets (buildings), to be recorded in the goods and services account with the rest of the world. - An import of goods for the total value of the produced nonfinancial assets (machinery and equipment) to be recorded in the goods and services account with the rest of the world. - Recording these transactions affects the current balance with the rest of the world (by the value of the imports) while the balance on the capital account (net lending/borrowing) remains unchanged. - Recording of FISIM as exports: - NIS estimates FISIM in the production account for banking services; portion sold to nonresidents is deemed an export of services in the external account of goods and services. - Complete recording should include an entry in the external account of primary incomes and current transfers, within property income. - NIS does not currently incorporate this entry, which means the current balance with the rest of the world is understated because it includes FISIM as exports only, and not additionally as property income/interest payable. ### Production approach procedures (coverage, methods, and deficiencies) - Annual production accounts compiled at a sufficient level of detail, covering 135 economic activities (disaggregation at group (three-digit) or class (four-digit) level, depending on the activity). - The supply and use table (SUT): - Prepared only for base year 1996. - Covers the balance of 75 product groups at the most detailed level. - The SUT has 52 activities. - Fixed ratios more than five years old are used for: - 42 percent of estimated 2004 GDP at constant prices. - 29 percent of estimated GDP at current prices. - Specific techniques and issues: - Owner-occupied dwellings valued at market prices for similar dwellings (sources: HES and LSS). - Growing crops, standing timber, livestock, and construction projects are treated as works in progress and measured in production accounts. - Inventories data are not adjusted for holding gains or losses. - Consumption of fixed capital measured by depreciation rules used by reporting businesses (source SNB), not necessarily consistent with the perpetual inventory method. - No calculation of fixed capital consumption in housing services, despite available information on stock deletions. - Government expenditure recorded on an accrual basis, but revenues and taxes/subsidies on products are recorded on a cash basis and are not converted to accrual in national accounts compilation. - Methods for volume measures: - Use of double or single indicators, price deflators, volume extrapolators, or combinations. - Most important activities generally use adequate methods (example: Panama Canal supplementary activity — double deflation applied). - Inappropriate price/volume indices used in other activities (examples: retail trade and insurance planning services deflated by general-level CPI; public administration estimated with volume index of employment). - Specific deflator and estimation problems: - Deflator for FISIM at constant prices is product of two indices: interest rate spreads and the WPI (general level excluding oil) — not considered adequate. - Taxes/subsidies on products at constant prices: current values deflated by price indices (general level) instead of extrapolating from base year using volume index of transactions subject to the tax/subsidy. - Value added in public administration, public education, and public health at constant prices estimated by extrapolating with a volume index of public employment. Could be improved by incorporating detailed salary-category employment changes; for education, student enrollment by level could be incorporated. - Change in volume of GDP measured using fixed-base Laspeyres-type formula; annual chain indices not used; base year 1996 considered obsolete. ### Expenditure approach procedures and deficiencies - Government final consumption expenditure, gross fixed capital formation, foreign trade, and changes in inventories estimated independently; household final consumption derived as a residual of supply and remaining demand components (residual called “private consumption,” includes NPISH). - Household consumption: - Base year compiled using COICOP classification and estimated in SUT framework for 75 product groups. - For other years, COICOP/SUT classifiers not used because household consumption is a residual value. - Government final consumption compiled using COFOG. - Fixed capital formation compiled by asset type (construction: housing and other buildings; machinery and equipment: detailed information from foreign trade). - Changes in inventories compiled by activity and type, based on SNB. - Deflation and volume-measure issues: - Dedicated price indices are not used to deflate GDP components at the one-digit level. - Implicit deflator for household consumption not consistent with CPI because household consumption is a residual. - Intermediate consumption at current prices deflated by a suitable price index (price index defined as basket weighting main inputs from base year). - Base-year value added extrapolated by public-sector employment index. - Volume measure of gross fixed capital formation in construction extrapolated from base year with volume index of total construction output; private construction deflated with IPCAMMOC; public-sector construction emerges as a residual — could be improved by independent calculation of public-sector construction using an appropriate price index. - Gross fixed capital formation in machinery and equipment measured by deflating current values of imports of capital goods by combined index: United States manufacturers’ export price index and a unit value index of imports into Panama (calculated by NIS). Could be improved with price indices for foreign trade. - Volume measure of changes in inventories is incorrect: current values deflated by WPI at the general level. - Volume measure of exports and imports obtained by deflation using deflators based on baskets weighting internal and external indices that include the CPI, import WPI excluding oil, and unit value indices prepared by the NIS — deflators not considered adequate. ### Specific quarterly compilation techniques - Quarterly GDP compiled only at constant prices using the production approach; generally coincides with annual methods at constant prices. - Fixed-base Laspeyres formula used for quarterly series. - Annual estimates combined with quarterly indicators using the Denton proportioning method. - Quarterly compilation system derived at original values; seasonally adjusted quarterly estimates obtained using X11-ARIMA (this fact is not publicized). - Monthly economic activity estimate (MIEA) reasonably approximates quarterly GDP methods; weightings are for 1997 rather than 1996. - MIEA is “a combination of basic monthly indicators for the output of goods and services, prepared with a quantum index, which maintains a system of weights from the base year, which in Panama’s case is the year 1997.” --- ### 3.4 Validation, discrepancies, and related procedures ### 3.4.1 Validation of intermediate results - Intermediate results systematically validated against other data sources: - Production data from surveys compared with data from tax declarations supplied by the DGI. - Foreign trade figures validated with data from SNB-CFZ. ### 3.4.2 Assessment and investigation of statistical discrepancies - Significant statistical discrepancies are analyzed when detected, but there is no systematic procedure for assessing them. - In practice, discrepancies become part of expenditure in GDP because private consumption is calculated as a residual. ### 3.4.3 Investigation of discrepancies and indicators of problems - GDP estimated by three approaches: production, expenditure, and income. - Statistical discrepancies are not investigated because they are never explicit. - Discrepancy between GDP by production activities and GDP by expenditure components is included in private consumption (derived as a residual) and thus not separately identified; its value is unknown. - The discrepancy between GDP by production activities and GDP by expenditure components is included in the net operating surplus, which is also derived as a residual. - Statistical discrepancies between production and expenditure approaches are not routinely investigated because the SUT is not prepared annually. --- ### 3.5 Revision studies - No studies are conducted to assess initial estimates against revised or final estimates (e.g., studies of scale, direction, or magnitude of revisions). - No regular studies of long-term trends in the revision pattern to identify systematic bias. --- ### 4 Serviceability ### 4.1 Periodicity and timeliness - 4.1.1: GDP statistics are disseminated annually, consistent with the IMF’s GDDS. - 4.1.2: Annual GDP statistics are disseminated within six to nine months after the end of the reference year, consistent with the GDDS. ### 4.2 Consistency #### 4.2.1 Internal consistency - National account statistics are generally internally consistent. - Supply and use framework is not used for consistent estimation of supply and use components. - Discrepancies are included as part of private consumption, since production approach sources considered more reliable than expenditure approach sources. - Total supply of goods and services coincides with total use because use figures are not derived independently. - Production of computer software (net of exports) is measured on the supply side but incorporated into residual private consumption rather than fixed capital formation. - Volume indicators and implicit deflators are consistent with the “value = volume x price” framework. - Quarterly GDP estimates are consistent with annual estimates; concepts, definitions and classification are the same across quarterly and annual series. #### 4.2.2 Reconciliability over time and with the rest of the world - Transactions with the rest of the world can be reconciled with balance of payments data, but technical and coverage problems cause differences: - FISIM is included as exports of services in national accounts, but not in the balance of payments. - Adjustment for under-recording of exports by CFZ firms: trade transactions conducted abroad not recorded as imports or re-exports in balance of payments because they do not take place within Panama’s economic territory. These transactions are included as exports of goods in national accounts but not in balance of payments. - Differing treatment of fees collected by Panamanian consulates abroad for inspection of Panamanian flag vessels belonging to nonresidents: national accounts treat them as exports of services; balance of payments records them as current transfers. - Treatment of imports and exports of insurance and reinsurance services differs between frameworks. - Of these four areas, the methodological discrepancy that would persist is the FISIM treatment; remaining discrepancies should be reconcilable between frameworks. - For business conducted abroad by CFZ firms, figures should be revised and, if verified, recorded as exports of services rather than exports of goods. #### 4.2.3 Reconciliability with other data sources/frameworks - Government finance statistics (GFS) can be reconciled with national accounts. - National accounts coverage is broader than the GFS, covering central government, decentralized agencies, the PCA, and provincial governments. *Source: 3.2 Assessment of source data (National Accounts).* ### 4.3 Revision policy and practice ### _cr06387 - 4.3 Revision policy and practice ### Revision cycle and disclosure - The revision cycle for the annual national accounts is predetermined and reasonably stable from year to year. - Estimates for year t are released as follows: - Real GDP, first estimate — March of year t+1 - Real and nominal GDP, preliminary — September of year t+1 - Real and nominal GDP, revised (final) — September of year t+2 - The revision cycle is publicized in the calendar of publications on the web page and the underlying reasons are explained via the ITCNA. - Content and sources of each estimate: - The first estimate is based on quarterly GDP calculations (for the first three quarters) and an initial estimate for the fourth quarter of the preceding year. - The preliminary estimate includes information based on surveys, records and financial statements from businesses. - The final estimate incorporates a revision of data based on amendments that may originate from the sources. - Changes in the base year for the national accounts do not follow a regular schedule. ### Identification of provisional data - At dissemination, data are identified with footnotes indicating whether they are estimates (E), preliminary (P) or revised (R). ### Revision studies and practice - Results and studies of revisions are not routinely reported to users, except when they are especially significant. - Analysis of revisions is not carried out to inform the statistical process regularly. - Analysis of revisions for preliminary GDP estimates are not available. - Studies and analyses of revisions are carried out only when there is a change in the reference period. - Planned improvement: - The study to be carried out in 2006 includes a program for improving the quality and robustness of statistical data for changing base years. ### Accessibility — data presentation and formats - Presentation and content: - Annual national account statistics are published in a clear manner, with charts and tables and time series to facilitate analysis. - Final household consumption is presented only as an aggregate, and is included under the concept “private consumption,” together with consumption expenditure of NPISH. - There is no analysis of current-period developments in each publication. - Quarterly GDP series provide only seasonally-adjusted values, and not original values. - Dissemination media and formats: - Data are disseminated in printed and electronic formats. - Primary electronic dissemination is in PDF rather than EXCEL, which does not meet some users’ needs. - More comprehensive and/or detailed statistics are also disseminated in paper format (available at the DSC Library) and/or in electronic format. - Preannounced release and simultaneity: - Statistics are released punctually, in accordance with a preannounced schedule. - Statistics are made available to all users at the same time. - Non-routine data: - The DSC makes available other general statistics that are not regularly published upon request, but the availability of additional statistics is not publicized. - The seasonally-adjusted GDP series are not published because they are still at the experimental stage; once this stage is completed, they should be released to users. ### Metadata accessibility - Documentation: - Sources and methods for the annual national accounts are described in “National Accounts Methodology,” available at the DSC web page. - Quarterly GDP accounts are described in “Estimation Methodology for Quarterly Gross Domestic Product.” - The GDDS metadata are reviewed and updated regularly. - Level of detail: - General information on the national accounts is available and made public via publications and the Internet. ### Assistance to users and contact points - Contact points and user assistance: - General assistance is provided through the Statistics Information Center, which receives requests and concerns, and has an electronic mailbox: cie_dec@contraloría.gob.pa - The DSC website invites users to submit consultations by e-mail, and provides telephone numbers and the address for the Library. - Some publications make no mention of contact points that can be reached by mail, telephone, fax or e-mail. - Administrative response standard: - There is an administrative provision that sets a limit of seven days for responding to user requests. - Catalogs and charges: - There is a catalog of publications and documents that includes their prices, available over the Internet under the heading “Dissemination Calendar.” ### Key related quality and operational findings (from companion assessment table) - Resources and staffing: - Human and financial resources are slightly smaller, by about 10 percent, than required to carry out all the tasks and for updating of the base year. - Contractual staff is 36 percent of total staff, and wages are low. - By May 2006, 80 percent of the staff will have access to the Internet. - Reconciliation and methodology concerns: - The base year for constant prices is outdated (1996). - The use of fixed ratios in the total estimate of value added exceeds 20 percent (35 percent of GDP). - Proper procedures are not followed for compiling output volume measures (WPI for deflating instead of PPI) and taxes/subsidies on products deflated by CPI. - Lack of proper reconciliation framework (supply and use tables); discrepancies between production and expenditure approaches are not routinely investigated. - Source data and surveys: - The 2001 business register is updated only with new enterprises and does not remove enterprises that go out of business. - Household income and expenditures survey is conducted every 10 years instead of five years. - The non-response rate to the HIES 1997–1998 was around 12 percent. - Non-response for price surveys is around 1 percent. - In September 2006, a full review will be performed to update the business directory. - In 2007, consultant services will be used to prepare producer and wholesale price indices. - Revision policy summary: - Only analysis and causes of major revisions are made public. - Change of base year does not follow a regular schedule. - Analysis of revisions is carried out mainly when there is a change in the reference period. *Source: _cr06387 - 4.3 Revision policy and practice* ### 0.2 Resources ### 0.2 Resources ### 0.2.1 Staff, facilities, computing resources, and financing are commensurate with statistical programs - Staffing and organization - The legal framework stipulates that the DSC shall have the necessary personnel to carry out its functions, but the number of field agents assigned to data collection for the CPI at the central and regional offices is insufficient. - Example: regional office (Changuinola) has only 1 field agent for collecting CPI price data and conducting other DSC surveys; continuity of price collection could be affected when this agent is sick, on vacation or working on other surveys. - Only two professionals are assigned within the PSLS for analyzing and improving CPI methodology. - There are six assistants, although most assistants may be reclassified to higher functions given their academic records and experience. - Nearly half of the staff working on the CPI are contractual personnel, with contracts typically renewed annually. - The mix of staff involved in the compilation of the CPI is presented as follows: - Price and Standards of Living Section (CPI31): Permanent 6, Contractual 6, Total 12 - Chief: 1 0 1 - Deputy Chief: 1 0 1 - Supervisor of Statistic II: 1 0 1 - Professional (Statistics I and II): 2 0 2 - Assistant of Statistics I: 1 5 6 - Assistant I: 0 1 0 - Regional Offices (CPI32): Permanent 12, Contractual 9, Total 21 - Field agents: 12 9 21 - Total: Permanent 18, Contractual 15, Total 33 - Currently, field agents and staff are not sufficient for CPI data collection. At least two additional staff are needed. - There will be a shortage of resources (both human and financial) for the conduct of the 2007–08 HIES and the compilation and dissemination of a CPI with a new reference base. - Average seniority of staff in the CPI is approximately 11 years. - Years in service of staff involved in the CPI compilation: - 0–4 years: Permanent 1, Contractual 1, Total 2 - 4–8 years: Permanent 2, Contractual 12, Total 14 - 8–16 years: Permanent 7, Contractual 2, Total 9 - 16–24 years: Permanent 1, Contractual 0, Total 1 - 24–33 years: Permanent 7, Contractual 0, Total 7 - Total: Permanent 18, Contractual 15, Total 33 - Percentage composition: - 0–4: 5.5 6.7 6.1 - 4–8: 11.1 80.0 42.4 - 8–16: 38.9 13.3 27.3 - 16–24: 5.6 0.0 3.0 - 24–33: 38.9 0.0 21.2 - Total: 54.5 45.5 100.0 - CPI staff receive on-the-job training and formal courses/seminars (mathematics, statistics, introduction to index numbers); training opportunities are not offered regularly. The DSC maintains a regular training program in statistics, informatics, and human relations. - Salaries at the PSLS are not competitive with other ministries and public dependencies due to classification and grading issues; contractual personnel salaries are low and pose retention risk. - Facilities, computing, and equipment - PSLS computing resources: - Eight computers (mainly Pentium 4), one server, and two printers (one printer not working adequately). - Only the four supervisors’ computers have Internet access. - Only permanent personnel have their own CG e-mail account. - Regional offices usually have only one computer and printer for data processing for all economic surveys; some computers lack sufficient capacity and speed; some printers are out of order or not functioning appropriately. - Distribution of computers considers staff tasks and work programs. - The CPI is computed using applications developed in Oracle client 6i for Windows; an Oracle database (Oracle Server 8.i) stores CPI data. A daily back-up of CPI data is made. - Employees have access to Office 2000 (Excel, Word, PowerPoint) and Access; software is not regularly updated due to budget constraints. - CG building: adequate cooling, restrooms, and power system; storage units and office space are not adequate. - PSLS lacks direct phone lines to call respondents for verifying prices and investigations. - Transportation equipment for CPI data collection: 1 vehicle per area is insufficient; some vehicles in poor condition; vehicles must be shared with other surveys, sometimes delaying price data collection. - Food allowance for price collectors is insufficient for certain areas (Las Cumbres, Tocumen, Juan Díaz), causing collectors to return to the office and take more time to collect data. - Financing and budgets - Financial resources for compiling the CPI are insufficient; funding is provided under the DSC budget process, which usually faces budget cuts. - PSLS budget figures: - Budget for the PSLS in 2006 is $78,885, 12 percent less than that for 2005 ($89,684). - The approved budget for the CPI program in 2005 ($68,126) represented only 1.5 percent of the total approved budget assigned to the DSC ($5,812,506) and represents even less (1.1 percent) in 2006 ($70,471/$6,412,505). - A budgetary cut in the DSC of 24 percent in 2005 and 10.6 percent in 2006, as well as delays in resource allocation to the DSC, have affected the rate of execution of the CPI program. - Issues regarding the permanent functioning of the cashier office affect the data collection process of the CPI. - Short- and medium-term work programs are considered in the budgetary process. Requests for funding for special projects (pilot HIES, 2007–08 HIES, changing reference base, expanding coverage, methodological studies) are included as part of the budgetary process for special surveys. - PSLS has received technical assistance from independent consultants for the 1997–1998 HIES, sampling techniques, compiling the CPI (October 2002=100), and systematizing the CPI compilation process. ### 0.2.2 Measures to ensure efficient use of resources are implemented - Planning, monitoring, and performance evaluation - The DSC has a five-year (2005–2009) strategic plan, broken down into annual work plans, administered by organizational units in coordination with the Directorate of Economic Assistance (DEA) and the Department of Administrative Services (DAS). - The DEA meets with each organizational unit every six months to review progress with the five-year plan and yearly plan; allocation of financial and human resources is discussed with DAS, Directorate of Administration and Finance (DAF), Directorate of Development of Human Resources (DHR), and Directorate of Internal Auditing. - Each unit formally reviews progress monthly through reports sent to the Director of the DSC; summaries prepared for review by the controller general. - DSC personnel performance is annually evaluated and quarterly reviews of staff performance are conducted; evaluations and tests are used for promotions. - Assignment of responsibilities among the PSLP and regional offices is clear; every position at the CG has a profile with specific functions, tasks, and minimum requirements. - Supervisors within the Socio Economic Sub-Directorate (SESD) meet regularly to measure progress, define work, and analyze CPI results; working meetings held as needed. - Resource allocation and efficiency measures - Budget procedures are carried out on a line item-by-item basis. - Periodic assessments are made of resources employed for compiling statistics, but no comparisons are made to other statistical programs. - Resource needs are not reviewed regularly to ensure scarce resources are employed efficiently to address major data problems or new data priorities. - Daily productivity rates are calculated for data collection, processing, and analysis; data verification systems are in place (number of questionnaires collected by month and number of errors by item are tracked). - An efficient application in Oracle client 6i was developed to compile the CPI, improving data validation and keeping digital records of corrections and revisions. - Use of technology and dissemination - The CG and DSC have an active program to take advantage of new computing technology, including the Internet, for data processing and dissemination. - The CG Internet website is well designed according with the standards of the Bank of International Server and is an important part of dissemination. - PSLS delivered a seminar to price collectors in 2004 to discuss changes in CPI compilation processes. ### 0.3 Relevance - Monitoring user needs and engagement - The CG Library and website provide timely information on DSC’s statistical products. - The Department of Information and Dissemination (DID), through the Statistical Dissemination Section (SDS), Publication Services Section (PSS), and the Library, monitors and keeps records on users’ requests and unmet needs. - The DSC has a Statistical Information Center that receives requests and queries directly or through an e-mail address provided on the CG website: cie_dec@contraloria.gob.pa. - The CG website has a place for comments and suggestions when users do not find needed information. - A seminar for statistical agencies and key public and private users and a users’ survey was conducted in 2003 within the framework of the NSSD to obtain feedback from users. - The PSLS does not have regular meetings with entities participating in the NSS or a formal process for consultation with policy departments and index users to discuss statistical development and establish new data requirements for the CPI; PSLS monitors users’ needs through data requests. - The PSLS has a list of 179 permanent users who receive CPI data by e-mail. - When a new census or survey is conducted, a users’ committee is created to include users’ data requests in questionnaires where relevant. - PSLS staff participate in meetings and seminars on price statistics within budgetary constraints. ### 0.4 Other quality management - Quality-focused processes and planning - The DSC attempted a Total Quality System in 1997 and implemented a Reengineering Program; the strategic plan contains essential characteristics of a total quality management program and provides a framework for continuous structured review of resource allocation and data quality elements (accuracy, methodological soundness, reliability, serviceability, accessibility). - The DSC is preparing a NSSD aimed at strengthening the NSS. - PSLS goal for 2006: improve timeliness of the CPI for Panama and San Miguelito and the CPI for the rest of urban areas to 11 business days after the reference month. - The CG promotes a quality concept among staff through its ten commandments: Staff “shall provide the best service and offer a high quality level in the performance of their duties.” - CG, DSC Director, and staff meet regularly with media to discuss economic developments and DSC projects for improving statistics. - Price collectors and analysts are periodically trained on errors to be avoided (respondent errors, questionnaire completion errors, transcription errors, analysis errors); PSLS and regional staff meet periodically to assess data collection and changes in item specifications. - PSLS is working on rollout of an integrated database with all information from the DSC to support timely and consistent use of price statistics. - CG has an ongoing program to identify changes in specifications for CPI market basket items (clothing, motor vehicles, high technology items); new item specifications are introduced into the index as needed. - Monitoring and quality control practices - Effectiveness rates by field agent are calculated: number of questionnaires collected by month and number of errors by item; field supervisors call field agents for explanations on questionnaire comments. - Response rates to price surveys are not calculated and complete monitoring processes (editing rates, revisions history, timeliness evaluations) are not in place; nonresponse rate for price surveys is negligible and informants are replaced if necessary. - Regular visits to regional offices to oversee price collection were suspended in 2003 due to budget constraints; these visits previously verified abnormalities detected during monthly reviews. - Compilers have access to expert guidance when international organizations provide assistance or the CG contracts experts. - The PSLS has established practices and procedures to ensure quality at all levels: data collection, data processing, index tabulation, and dissemination. - Monthly price collection is reviewed at regional and national levels; some questionnaires are randomly selected for verification. - Data entry and screening are handled at PSLS and regional offices; computer listings allow review and validation of the index at each level. - Errors are corrected after consultation with respondents and regional staff when necessary; index aggregates are reviewed and analyzed by PSLS staff at various administrative levels before publication. - There is a manual on data collection and processes to supervise data collection and apply consistency checks; a sub-sample of questionnaires is verified by regional supervisors; staff keep records of errors and improvements for future surveys; follow-ups are performed via monthly reporting to managers. - Although there are no official mechanisms (users’ survey or official advisory groups) for regular feedback on CPI methodological issues, the CG convenes ad hoc groups when a new HIES is to be conducted or changes to the index are considered; these groups tend to focus on methodological soundness rather than users’ needs. - The NSSD plays an important role in addressing user guidance; users’ needs are monitored through data requests, the CG website, and the PSLS list of 179 permanent users receiving CPI data by e-mail. *Source: _cr06387 - 0.2 Resources* ### 1. Assurances of integrity ### 1. Assurances of integrity ### Professionalism - Statistics are produced on an impartial basis; the CG recognizes the importance of professional independence of its staff and hiring/promotion are governed by CG regulations based on professional merit and excluding political affiliation. - Staff development: - Staff participation in training opportunities, workshops and seminars is encouraged; staff attending training must present content to colleagues on completion. - The ASD is in charge of personnel training. - Employees are encouraged to carry out research projects and participate in conferences, lectures, and professional meetings. - Methodological studies are circulated for internal review and, when appropriate, outside review; institutional papers submitted for publication must be approved by CG administration. - Lately, insufficient human resources assigned to CPI compilation have limited the number of staff dedicated to research and analysis. - CPI production and dissemination: - The CPI is produced and disseminated without outside influence; collection and compilation procedures are governed by technical considerations. - Conversation groups involving staff of different units forming the DSC meet regularly to discuss international recommendations and practical treatments. - Staff are internally evaluated every three months. - CPI publications are revised and validated by all levels of the hierarchical chain within the institution. - Staffing and leadership: - Staff members with outstanding performance are promoted for an interim period, with promotion made permanent after an appraisal confirms satisfactory performance. - The Director of the DSC is selected by the Controller General and lately he/she has not remained in his/her position for periods that exceed the term of the President. ### Professional choices and dissemination - Choices of sources and statistical techniques: - Selection of source data and statistical techniques for CPI compilation is based solely on statistical considerations within resource limits. - Sources and methods are fully under the control of the DSC and concepts and practices generally follow international standards. - Appropriate sources and techniques are used with no outside interference; decisions are made internally after considering methodological recommendations by international organizations. - Summary documentation on source data and methodology for the CPI has been prepared and is available to the public. - Commenting on misuse: - The DSC and the Controller General respond to erroneous interpretations of the CPI through press releases and conferences when necessary. - The Directorate of Social Communications monitors press and television references to DSC statistics. - CPI data and an executive summary on CPI trends are sent to reporters by e-mail and sometimes published in CG’s press releases. - Comments on CPI trends are included with tables sent to reporters and permanent users and are posted on the CG website; these comments identify main underlying factors behind unusual figures and movements. - The Controller General and the Director of the DSC are entitled to respond to public criticism or misuse, though few instances have required response. ### Transparency - Public access to terms and conditions: - Electronic publications reference the NSSD; a “Road Map” describing the work plan for developing the NSSD is available on the CG website. - The CG website includes a summary methodology and the technical conditions under which the CPI is calculated. - Transparency is inculcated in staff as one of the CG’s ten commandments. - The GC website includes a statement on the mission of the DSC referencing the Constitution, Decree 7 of February 25, 1960, and Decree No. 69 of March 31 of 1998. - The CG website does not reproduce material about terms and conditions under which official statistics are compiled and disseminated, such as the Law of the CG and its By-Law or summaries of articles on obligatory reporting, confidentiality, and staff professionalism. - The CG website contains an e-mail address for requests and suggestions; CG publications contain CG website address, phone and fax numbers. - Some statistical publications, such as Panama en Cifras, do not identify where more information about the CG and its products can be found. - The CG Library and the Section of Publication Service are responsible for providing information to the public. - Internal governmental access prior to release: - The PSLS indicates approval of published index series is exempt from outside interference and that CPI series are not provided to any government agency prior to official release. - Identification of products: - All CG publications include CG and DSC logos; joint publications identify each entity with logo or footnotes. - CG has a policy of releasing CPI publications in a standard format (titles, colors, typography). - Advance notice of major changes: - Major changes in methodology or data sources are not publicized before implementation. - Some permanent users are informally notified on request. - A report with a summary table of main differences between the new CPI and the previous index (1987=100) is published. - HIES questionnaires used for new market basket weights were presented ahead of implementation to a users’ committee including representatives of different ministries, researchers, and specialized users. ### Ethical standards - Guidelines and Code of Ethics: - A manual of instructions for field agents and supervisors provides guidelines about staff behavior. - CG staff are not authorized to alter or change statistical data received from respondents. - Ethical guidelines are based on Executive Decree No. 246 Code of Uniform Ethics of Public Servants of December 15, 2004 and the CG’s By-Law; each new employee is informed of the Code of Ethics and the By-Law and given a personal copy. - Ethics is one of the ten commandments of the CG. - Prohibitions and sanctions: - The Code of Ethics defines probity, prudence, justice, discretion, dignity, decorum, honor, respect, independence of criteria, and similar concepts. - Article 34 (Chapter IV on Prohibitions): “The public servant shall not give, solicit or accept directly or indirectly, gifts, benefits, promises or other advantages of individuals or staff.” - Article 35 establishes that “The public servant shall not solicit accept or admit money, grants, benefits, gifts, favors, promises or other advantages, directly or indirectly, in the following situations: a) To accelerate, delay, do or not do the tasks related to their functions; b) To influence other public servant,”...in order to do what it is mention in a). - Chapter VI on Sanctions of the Code of Ethics and VIII On Disciplinary Regime of the CG’s By-Law present sanctions including verbal and written reprehension, work suspension without salary, and dismissal. ### 2. Methodological soundness ### Concepts and definitions - Overall structure: - Concepts and definitions used in the CPI are generally in line with internationally accepted standards as defined by the International Labor Organization, the IMF, and others in the Consumer Price Index Manual, 2004. - Prices and weights broadly follow national accounts concepts—based on the 1993 SNA/1995 ESA—for all monetary household consumption expenditures. - Level of detail for commodities and services is sufficient for detailed analysis at divisions, groups, classes, and items of the COICOP. ### Scope - Population and coverage: - Geographic weights and market basket item weights are based on expenditure data from urban households included in the 1997–98 HIES. - The household sample is not representative of all income levels and household composition: expenditures of households in the lowest and highest deciles of the income distribution and one-person households were excluded from the weights. - The HIES was designed to separate consumption and business expenditures for households with unincorporated business activity. - Expenditure data from households involved in farming and fishing activities that resided in urban geographic areas were included in weights calculations. - Consumption of illegal market goods and services were not recorded in the HIES and excluded from CPI weights. - Nonmonetary goods (own-produced agriculture products and goods provided by employers as income in kind) were investigated but excluded from CPI weights. - Imputed rent for owner-occupied housing is excluded from CPI weights despite an imputation in HIES results; this exclusion departs from international standard practices. - Materials used in housing repairs are incorporated in the weights. - CPI weights cover expenditures of urban resident households only; rural households were not covered in the HIES and are excluded from CPI weights due to budget constraints. - Until 2002 the index covered only Panama City; since then prices have been collected in each major city and urban area of the seven provinces of Panama. - Cities were selected from three main regions: Metropolitan, Central, and Western; the sample of cities together with outlet coverage is considered representative of the pricing structure throughout the country. ### Classification/sectorization - Classification systems: - All classification and coding for the 1997–98 HIES and the current CPI are based on a Panamanian version of the COICOP. - Departures from standard COICOP: - Food and non-alcoholic beverages; alcoholic beverages and tobacco; communications; and restaurants and hotels are treated differently. - Alcoholic and non alcoholic beverages are combined. - Tobacco and communications are included in miscellaneous goods and services. - Hotels are included in recreation and culture. - Restaurants (food consumed out of the household) are included together with food and beverages. - Index data are available at the item (basic expenditure) level, allowing users to obtain detailed data and reclassify if desired. - Expenditure data are classified into a five-digit version of COICOP including item varieties. - The CPC was not used to classify items, but the CPI classification is broadly in accordance with the CPC at product level. ### Basis for recording - Valuation and prices: - CPI weights are based on expenditures from the 1997–98 HIES measured at market prices (purchaser’s prices), including trade and transportation margins and taxes and subsidies on products. - Taxes included: Tax on the Transfer of Goods and Services (ITBMS), Selective Tax on the Consumption (ISC) of Alcoholic Beverages and Tobacco, Tax on Consumption of Fuels, Tax on Vehicles, and Tax on Hotel Services. - The only subsidy on products for final consumption is the subsidy on liquefied gas buckets of 25 pounds, which is reflected in the CPI. - Prices include discounts if applied for more than a month and do not include price bargaining (price bargaining is not usual in Panama); this deviates from international standards where discounted prices should be taken into account if generally available. - Product specifications for pricing include unit of measurement, presentation, quantity, and weight; field agents check product specifications. - Recording basis: - All prices used for estimating market basket item weights and for monthly price collection are measured on an accrual basis; prices are recorded in the period during which items are offered for sale. - Grossing/netting: - For CPI weights, purchases of durable goods such as automobiles were recorded only as new goods; disposals to other households were not registered as acquisitions less disposal. - Information collected in the 1997–98 HIES may permit separation of purchases of new goods from purchases of used consumer durables and identify sales of used consumer durables to allow net-weight estimates for automobiles. ### 3. Accuracy and reliability ### Source data - HIES history and frequency: - HIES rounds: 1942, 1955–56, 1962, 1972, 1983–84, and 1997–98. - Frequency has been 10 to 13 years owing to budget constraints instead of the 5 years recommended by international standards. - Authorities indicated the next HIES will be conducted in 2007–08 and a pilot survey in 2006; this activity has been included in the CG’s budget. - The MEF conducted living conditions surveys in 1997 and 2003 under MECOVI; typical living conditions surveys are conducted over a four-month period, potentially introducing seasonal bias. - Sampling frame and design for 1997–98 HIES: - Sampling frame: 1990 Census of Population and Housing (CPH). - Sampling frame contained 1,071,052 inhabitants (761,130 for Panama City and San Miguelito and 309,922 in the rest of the country) and 253,900 housing units (180,742 in Panama City and San Miguelito and 72,158 in the rest of the country). - Two sub-populations: Panama and San Miguelito; and the rest of the country. - Two-stage stratified random procedure with replacement: 9,002 households selected (6,493 in Panama district and San Miguelito and 2,509 in the rest of the country). - Territory frame included 18 urban areas: 1) Panama City (capital district), 2) San Miguelito district, 3) La Chorrera, 4) Barrio Colón, 5) Aguadulce, 6) Pocrí, 7) Barrio Norte, 8) Barrio Sur, 9) Almirante, 10) Chitré, 11) La Arena, 12) Monagrillo, 13) Barrio Balboa, 14) Cativá, 15) Puerto Pilón, 16) Sabanitas, 17) Changuinola, and 18) David. - For each conglomerate of 30 dwellings on average, household sampling was randomly distributed over the 52 weeks covered by the survey (May 1997 to April 1998). - Sample size was increased by 20 percent to replace households that refused to respond. - Thirty-six additional conglomerates of new urban areas post-1990 Census were included in a special stratum. - Final number of conglomerates: 1,013. - Final number of households surveyed: 9,624 (2,448 in Panama and San Miguelito districts and 7,176 in the rest of urban areas). - Sample size calculated to yield an estimated sampling error of plus or minus 10 percent with a confidence level of 90 percent for each city. - Sample for second stage: 16 households in Changuinola, Aguadulce, and Santiago; 8 households in each conglomerate for remaining urban areas. - Complete information for 8,455 households including all income levels was collected (1,956 households for Panama and San Miguelito districts and 6,499 for remaining urban areas). - Questionnaire and valuation: - HIES questionnaires were constructed according to sound design principles, pilot tested and pre-tested. - Tabulations of 1997–98 HIES data were prepared in sufficient detail for item sample selection and market basket weight estimation. - Purchases valued at purchaser’s prices; own production valued at market prices; imputed rent for owner-occupied housing estimated from market rents for rental units, but own production and imputed rent were excluded from CPI weights. - Purchases in informal markets were included in weights; HIES results were expanded to reflect the survey-sampling universe. - CPI market basket and price collection: - CPI market baskets included a sample of 257 products and services for Panama and San Miguelito districts and 270 for the rest of urban areas. - Aggregation: nine divisions (COICOP divisions), 43 aggregations (COICOP groups), 66 groups (COICOP classes), and 83 sub-groups. - Prices are collected in nine major urban areas: Panama City and San Miguelito, Colón, La Chorrera, Aguadulce, Chitré, Santiago, David, and Changuinola. - Expenditure by one-person households and households in the lowest and highest deciles were excluded from market basket weights. - Price indices are compiled for Panama and San Miguelito districts, the rest of urban areas and at national urban level. *Source: _cr06387 - 1. Assurances of integrity* ### 0.06 percent and reported by 10 percent or more of households (frequency of consumption) ### 0.06 percent and reported by 10 percent or more of households (frequency of consumption) ### CPI market basket and outlet sampling - Items with "0.06 percent and reported by 10 percent or more of households (frequency of consumption)" were included in the CPI market basket. - Average sample sizes for monthly price collection: - 24 outlets for items in the food and beverages division. - 18 outlets for the rest of items in the CPI. - Outlet sampling frame: cartographic maps of the 1990 Population Census. - Sample size calculation: estimated sampling error of plus or minus five percent at a confidence level of 95 percent for each item. - Sample panels are divided into three-week panels. - Outlet selection uses purposive sampling based on: dispersion within each suburb, type of clients, cooperation of informants, class/type of establishment, significant consumer sales, variety of retail articles, location in commercial zones with large purchaser flow, and availability of goods/services in the CPI basket. - Coverage limitation: selected outlets cover major cities of urban areas and districts; consumer prices in rural areas are not covered by the CPI. - Item and variety selection: based on purchase volume and stable/significant sales activity. - Field agents monitor items regularly to keep product specifications up to date (notably clothing and technological products). ### Source data adequacy and timeliness - Expenditure data source: 1997–98 HIES; frequency of price collection surveys: daily. - HIES design: incorporated required scope of household coverage, expenditure classification, purchaser price valuations, and recall/diary reporting of expenditure in the month it was actually made. - Operational issues: - Price data by retailer and item are not always collected on the same date every month due to competing survey priorities or unavailability of transportation equipment. - Prices are not collected during the last week of the month. - Only price data from the monthly price survey conducted by the PSLS are used in the published CPI. - Prices are collected during the first three weeks of each month; respondents usually provide information the same day of the interview. - Zone supervisors apply follow-up procedures to ensure timely receipt of source data. - CPI publication timeliness: monthly CPI is published 15 days following the reference month. ### Assessment of source data (coverage, nonresponse, quality controls) - Nonresponse rates: - 11.5 percent at national level for the HIES. - 18.6 percent in Panama and San Miguelito. - 9.1 percent in the rest of the country. - Around 1 percent for the price survey. - Sampling errors for the HIES have been calculated using IMPS 3.0. - Price survey monitoring: regular, but visits of central office staff to regional offices were discontinued due to budget constraints. - Nonsampling errors (survey operations, biases, over/under-coverage, misclassification, processing) are not available. - Price scrutiny: atypical prices are verified with respondents before use; computer program reviews the price collection process. - Verification thresholds: variations of more than 1.6 percent and less than minus 0.6 percent are verified. - Reports on source data and coverage control are prepared and used. - Proportion of household final consumption expenditure not covered in regular CPI compilation is not assessed and comprises more than 40 percent (corresponding to rural areas, one-person households, and households in the lowest and highest deciles). ### Data compilation and statistical techniques - Error-minimizing procedures: coding, editing, and tabulation techniques applied; adjustments to individual records made only when clearly warranted. - Elementary index calculation: - Geometric mean of short-term price relatives at variety level for heterogeneous items. - Ratio of average prices for homogeneous items. - Regional aggregation: elementary indices aggregated using regional expenditure shares at variety level. - Higher-level aggregation: Laspeyres-type formula is used. - Treatment of temporarily unavailable prices: - Food and beverage items missing during the first month: prices held constant. - Second consecutive month missing: impute using average price from other informants. - If all items of a sub-group are missing: impute using weighted average price change for the rest of sub-groups of the same group. - Miscellaneous items: prices held constant up to two months, then replaced by price of the brand collected simultaneously as replacement. - Identified methodological weakness: holding unavailable and seasonally unavailable prices constant can cause large jumps when prices reappear; potential permanent bias if items/varieties become permanently unavailable and old variety price is held constant for several months. - Introduction of new varieties and outlets: - New varieties are introduced when old varieties disappear. - Outlets are replaced when they refuse to provide information. - New products are introduced into the CPI only during a major revision of the index (change in weight reference period). - Quality adjustments: generally only repackaging adjustments (volume, weight, or count). ### Weights, references, and aggregation practice - Weights basis: monetary household consumption expenditure as defined in the 1993 SNA. - Expenditure weights include purchases in all markets, including informal markets. - Valuation principle: recorded value represents the economic cost to the consumer at the time purchased regardless of method of payment. - Elementary indices use unbiased formulas: weighted geometric mean of price ratios for heterogeneous items and ratio of average prices for homogeneous items; short-term price change from previous period used. - Aggregation to higher levels: internationally accepted Laspeyres-type formula. - Reference periods: - Weight reference period: monthly average expenditures for the period May 1997 to April 1998. - Price reference period: October 2002=100. - Weight update issues: - Current weight reference period and price reference period are not the same. - Expenditure shares are held constant from the weight reference period. - Weight reference period has not been updated within the past five years. - Linking practice: when new weights were introduced, the new index for Panama and San Miguelito was linked to the old index for Panama City using internationally accepted splicing practices. ### Validation, consistency, and comparisons - CPI is compared with other price indices: Wholesale Price Index (WPI) for imports, agriculture, and manufacturing. - Detailed price data compared with Ministry of Agricultural Development, Ministry of Commerce and Industry, and Commission of Free Competition and Consumer Affairs. - Comparison with national accounts: detailed CPI compared to implicit deflators of private final consumption expenditures. - Not used to improve coverage: micro surveys of uncovered production activities, household and trade surveys, and global estimates based on past benchmarks or judgments. - Internal validation: - Program for constant monitoring of price data; atypical prices reviewed before inclusion. - Reports on inconsistencies are prepared and analyzed. - Price data consistency checks across products and geographic areas; investigations into detected errors. ### Revisions, studies, and documentation - Revision practices: - Monthly CPI series are only revised in the event of errors; monthly CPI data are final when released. - Preliminary figures of the new CPI series (October 2002=100) were published when first released. - Revisions in published tables are marked with (R). - Revision studies: - Extensive studies carried out on the 1997–98 HIES regarding level of error and consistency. - Documentation: "Encuesta de Ingresos y Gastos de los Hogares, 1997–98, Resultados Finales, Distritos de Panama y San Miguelito" available. - Documentation on the latest CPI revision is available. - Weight update frequency concern: - HIES have been conducted every 10 to 13 years, which is not adequate; recommendation that HIES should be conducted at least every five years. - A pilot HIES will be conducted in 2006 and the next HIES will be conducted in 2007–08. - Limitations in documentation: - Documentation on price data adjustments (causes and methods) are not incorporated into the database, though a comments column on causes of adjustments exists in archived price questionnaires. - No routine periodic revision studies to determine CPI bias are undertaken. ### Serviceability: periodicity, timeliness, and consistency - Data collection periodicity: - Prices are collected daily. - CPI compilation periodicity is monthly, meeting GDDS recommendations and SDDS standards. - Timeliness: - Monthly CPI published 15 days following the reference month, exceeding GDDS recommendations and SDDS standards. - Internal consistency: - All-items index tabulations are consistent whether aggregated by expenditure category or by geographic area. - Time series continuity: - Revised national-level urban CPI with price reference October 2002=100 began publication in the second half of 2004. - Continuous historical series with October 2002 reference base available for January 2003–January 2006. - Series for Panama and San Miguelito districts linked to previous series with 1987 reference base and available since 1990. - Detailed methodological notes identify breaks and discontinuities (1952=100, 1962=100, 1975=100, 1987=100, and October 2002=100) and causes; no adjustments made to maintain historical consistency. - Publications: press release and monthly publication include brief analysis and explanations of unusual price behavior. ### Accessibility and dissemination - Publications and formats: - CG Quarterly Bulletin, Economic Situation, Wholesale Price Index and Consumer Price Index presents monthly inflation comparisons and cumulated inflation for March, June, September, and December. - Monthly summary journal "Consumer Price Indices (Indice de Precios al Consumidor)" posted on the CG website includes monthly price indices and price changes at division, aggregation, groups, and sub-group levels for national urban CPI, Panama and San Miguelito districts, and rest of urban areas plus analysis of trends. - "Average Retailers’ Prices, Simple Price Indices and Indices of Average Price Relatives" disseminated quarterly at item level for Panama and San Miguelito districts. - Annual CPI data published in "Panama en Cifras" with charts and tables at all disaggregation levels. - Limitations in dissemination: - Relevant series (e.g., food items) are not disseminated in seasonally adjusted form. - PSLS provides monthly detailed price data to the MEF in PDF formats rather than worksheets, requiring users to retype data. - Dissemination practices: - Press release prepared monthly by Directorate of Public Relations; CPI data posted on CG website and sent to a list of 179 permanent users. - Detailed statistics are made available to the public at the same time. - Published dissemination schedule posted on the CG website every year in the first week of January; CPI statistics are disseminated punctually. - Access to additional data: - Historical, unpublished, non-confidential CPI data and HIES data available upon request for national urban index, Panama and San Miguelito indices, rest of urban areas, item-level and higher-level COICOP aggregations. - Availability procedures for additional statistics are not made widely known. - Longer time series available by request from Publications Service Section (PSS) or CG Library; copying fee may be charged; users must provide diskettes/CDs for copying. - Contact information in publications includes CG website, address, phone, fax, and e-mail (cie_dec@contraloria.gob.pa). *Source: _cr06387 - 0.06 percent and reported by 10 percent or more of households (frequency of consumption)* ### 5.2 Metadata accessibility ### 5.2 Metadata accessibility ### 5.2.1 Documentation on concepts, scope, classifications, basis of recording, data sources, and statistical techniques - A detailed methodology of the CPI New Consumer Price Index: October 2002 (Preliminary Figures) (Nuevo Indice de Precios al Consumidor: Octubre 2002 (Cifras Preliminares)) is available to the public at the CG website in Publications on the Internet, Prices and Standard of Living and in hard copy and the quarterly bulletin. - Hard-copy publications are scarce: only 100 copies were printed. - A hard-copy publication with the revised new CPI series is being reviewed for publication. - Information on 1997–98 HIES’s monthly average household income, and expenditure by item, class, group, and division and urban area were published in the Household Income and Expenditure Survey 1997–1998, Final Results, Panama and San Miguelito Districts (Encuesta de Ingresos y Gastos de los Hogares 1997–1998, Resultados Finales, Distritos de Panama and San Miguelito), available in hard copy. - Survey characteristics, response rates, survey monitoring, method, sample frame, sample design and selection, critic, coding, and editing, data processing were not published. ### 5.2.2 Levels of detail adapted to intended audience - Publications and documentation tailored to different user groups: - Brochure Statistical Synthesis (Síntesis Estadística) provides summary data on main socio-economic indicators. - A summary of CPI methodology is available in hard copy in each quarterly bulletin. - A detailed CPI methodology is available at the CG’s Library, at the CG’s Center of Statistical Information, and on the CG website. - The detailed methodology documents concepts, scope, classification system, data sources and statistical techniques and is designed for users ranging from typical consumers to economic analysts. ### 5.3 Assistance to users — contact points, catalogs, and support 5.3.1 Contact points for each subject field - Prompt and knowledgeable service and support on the CPI is available through: - CG’s Center of Statistical Information - the PSS - the CG Library - Key personnel are listed in CPI publications, but contact points are not listed in Panama en Cifras. - Assistance to users is monitored through data requests, but is not reviewed periodically. - The CG’s By-Law requires information enquiries to be addressed within seven business days. - The DSC, in collaboration with the Ministry of Education, is developing a program to promote statistical culture. 5.3.2 Catalogs of publications, documents, and other services - A catalogue of DSC’s publications and CDs, with prices, is available from the CG’s PSS and on the CG website. - Orders can be placed through the PSS of the CG. - Assistance is provided in placing orders at the information center. - A copying fee may be charged for documents that are out of print or for information in the databases. ### Data Quality Assessment Framework — Summary findings and planned improvements (selected highlights) - Legal and institutional environment - Although legal framework assigns responsibility for compiling and disseminating statistics to the CG, it does not specify the scope of these statistics, including responsibility for compiling the CPI. Sanctions for non-response are outdated and rarely applied. - Resources - The PSLS does not have sufficient permanent staff for compiling and analyzing the CPI and carry out developmental work: 46 per cent of staff is contractual. - Transport equipment and per diem are insufficient for data collection. Some regional offices lack staff; data processing equipment and printers are inadequate. One of the printers at the PSLS is not working well. - Resources for the conduct of the 2007–08 HIES and the compilation and dissemination of a CPI with a new reference base are likely to be insufficient. - Access to Internet and to direct phone lines for carrying out price investigations are lacking. - More regular attendance in price statistics courses is needed. Work space of the PSLS’s facilities is limited. Resource needs are not monitored regularly. - Relevance and user consultation - A users’ survey was conducted in the framework of the NSSD, but no formal process established for consultation with policy departments and CPI users. Users’ needs are monitored through data requests. Users’ committees are only created when a new HIES is conducted. - As part of the National Development Strategy, working groups will be set up with users beginning in 2007. - Transparency and accessibility - DSC website does not reproduce material on the terms and conditions under which official statistics are compiled and disseminated (Law of the CG not disseminated). - Some statistical publications do not identify where more information about the CG and its products can be found. - Changes in methodology and source data are not announced in advance (October 2002=100). In some cases changes are noted to users when they request information. - A list of contacts with information on the person responsible for maintaining the section and the webpage was added to the publications in May 2006. - Beginning in August 2006, the Department will be working with a consultant to improve the accessibility and presentation of the webpage. - Methodological soundness and scope - Only urban households are in the scope of the index. No account is taken of one-person households, nor of homes in the lowest and highest deciles of the income distribution, which represent around 40 percent of total urban consumption expenditures. - Imputed rent of owner-occupied housing and own-account production of market goods for own final consumption are not included in the index, even though there is information in the HIES. These aspects will be considered in the new Household Income and Expenditure Survey, to be conducted in 2007/08. - Some departures from standard COICOP (e.g., alcoholic beverages, tobacco, communications, hotels and restaurants). The Central Product Classification will be adopted using the new base year. - Basis for recording - Discounts are only recorded if applied for more than a month. - Durable items such as automobiles were not recorded as acquisitions less disposals of such goods, even though information is available in the HIES. Discounts will be considered beginning in May. Automobiles will be recorded in the new HIES, to be conducted in 2007/08. - Accuracy and reliability - Final consumption expenditures and prices in rural areas are not covered. - Frequency of the HIES is 10 years instead of five years due to budget constraints. - Price data by respondent and item are not always collected on the same date every month and are not collected during the last week of the month. - The share of consumption expenditure not covered by the index is more than 40 percent. - Validation includes routine checks for extreme values, consistency, and completeness. Nonsampling errors are not calculated. - In some cases, previous price data are imputed for missing prices, introducing a possible bias in the index. - Changes in product specifications are introduced, but changes in quality are not excluded from price relatives. - New products are introduced only when a major revision is carried out. - Statistical techniques and revisions - Geometric mean is only used for heterogeneous products. - The current weight reference period and price reference period for the index are not the same. Practical exercises will be conducted to evaluate which of the two methods is preferable. - Monthly CPI data are final. CPI is revised in event of errors. Notes on price data adjustments are not stored in the database. Weights are not periodically assessed for bias. - A study on the last major revision (October 2002=100) was carried out. In coordination with the Computer Services Department, these aspects will be considered beginning in May 2006. - Serviceability and dissemination practices - Seasonally-adjusted data are not published. - PDF format is provided instead of spreadsheets. - Unpublished, but non-confidential, sub-aggregates of the statistics are available to users upon request, but the availability of this information is not publicized. - Beginning in April 2006, a note will be added to the publications indicating that the office has more up-to-date information available. - Complete methodology on the 1997–98 HIES has not been published. Detailed CPI methodology is available on the CG website. A hard-copy publication is being reviewed for publication. - The methodology and information for Other Urban Areas is being prepared and will be published in August 2006. - Contact points are not publicized in all publications (Panama en Cifras). Assistance to users is monitored through data requests, but it is not reviewed periodically. - The 2006 edition of Panamá en Cifras will indicate that each office has updated numbers available. - CPI base changes - The change in the price reference base does not follow a well established schedule (bases of the CPI: 1952, 1962, 1975, 1987, and October 2002). *Source: _cr06387 - 5.2 Metadata accessibility* ### 0.4 Other quality management ### 0.4 Other quality management ### 0.4.1 Processes are in place to focus on quality - Strong quality-oriented organizational culture, but no specific program for improving it. - Quality initiatives taken by compiling units are of small scope (short courses, workshops, specific short-term advisory services). - Training courses emphasize quality aspects in statistics production. ### 0.4.2 Processes are in place to monitor the quality of the statistical program - No measurements of quality indicators, despite a quality-oriented organizational culture. - Statistical processes are normally evaluated on a regular basis, but analyses are not comprehensive and focus on only one issue per evaluation (for example, validation techniques). ### 0.4.3 Processes are in place to deal with quality considerations in planning the statistical program - Various dimensions of quality are recognized; priority is given to timely delivery of information. - Strong and intensive efforts are made at reconciliation between institutions to guarantee accuracy. - Working hours are often extended as deadlines approach. ### 1. Assurances of integrity ### 1.1 Professionalism - Professional independence in compiling and disseminating the GFS is based on the Transparency Act and the Uniform Code of Ethics for Public Servants. - Transparency Act: Article 22 establishes penalties of up to twice the monthly salary for employees who obstruct access to information or who destroy or alter a document or record. - Transparency Act: Article 27 requires all government agencies and offices to establish and publish their respective codes of ethics, including aspects relating to conflicts of interest; staff must report any act of corruption to a superior. - Uniform Code of Ethics for Public Servants requires central government agencies to observe provisions of Article 27 of the Transparency Act and establishes principles including independence of judgment (Article 21), proper fulfillment of duties (Article 24), and the obligation to report (Article 29). - Organizational culture respects these principles; compiling staff have remained in positions despite changes of government. - Hiring governed by selection procedures based on clear and pre-defined professional profiles. - Choices of sources, statistical techniques, and dissemination decisions are informed solely by statistical considerations: - Organizational culture and legislation free statistical staff from political interference in selecting sources, methods, or introducing changes. - Dissemination of the GFS follows a calendar established by the budget law and provides information simultaneously to all interested parties. - The compiling units provide technical assistance on published GFS; Minister of Economy and Finance holds a press conference when releasing the Quarterly Economic Report. - No official policy on commenting on erroneous interpretation, but compiling units monitor and correct interpretation errors directly or via press releases. ### 1.2 Transparency - The MEF website provides access to various laws governing data gathering, compilation, and release; specific provisions are not clearly identified, and the Uniform Code of Ethics for Public Servants is not accessible. - No information is provided in advance to the executive or legislative branches; statistics are delivered simultaneously to all interested parties. - All statistical products clearly identify the compiling entity and unit; in joint publications the data-preparing entity is identified separately from the analysis-producing entity. - Use of figures is monitored to ensure correct use and correct attribution of authorship. - No major changes in recent years to GFS methodology; minor methodological changes are announced in the publication where first incorporated via methodological notes to the tables identifying changes. ### 1.3 Ethical standards - Legal provisions (Transparency Act and Uniform Code of Ethics for Public Servants) and organizational culture provide protection against interference. - Ethical rules are understood, respected by staff, and explained in the induction procedure for new employees. ### 2. Methodological soundness ### 2.1 Concepts and definitions - Compilation and dissemination of the GFS is based on the GFSM 1986. - Some discrepancies exist between Panamanian statistical practice and GFSM 1986; these are reviewed in subsequent sections. - No plan for migration to GFSM 2001, despite emphasis from the GFS mission of February 2004. - The CG included a migration plan among objectives for the Strategic Five-year Plan, but no steps have been taken with the MEF to affect that plan. ### 2.2 Scope - Fiscal statistics disseminated by the MEF include central government, general government, and the NFPS. - Except for the “Trust Fund” (Fondo Fiduciario), only the budgetary central government (Central Administration) is covered in full detail for revenue, expenditure and financing concepts. - Remaining levels of government have incomplete information because a sample of institutions (the so-called “consolidated” institutions) is used to compile details for decentralized institutions and nonfinancial public corporations. - No adjustments or projections are made to extend detailed results to other decentralized institutions and nonfinancial public corporations; activities of these are measured by their financing, which is aggregated, with its sign reversed, as a revenue line for NFPS (same practice used with the Trust Fund in the budgetary central government). - The PCA is not included in the NFPS. - Local governments (municipios) are recorded as “unconsolidated” institutions; local government budget is about 0.6 percent of that of central government and municipalities do not have capacity to borrow. - Fiscal statistics prepared and published by the CG do not provide breakdown needed to identify inter-institutional transfers at central government and general government levels; only a total of consolidated transfers for NFPS is provided. - Public debt statistics published by the MEF provide complete information according to residence and are broken down by holder and type of instrument. ### 2.3 Classification/sectorization - Classification problems in core source data are resolved using supplementary data sources; problem remains separating customs duties from the Impuesto a las Transacciones de Bienes Muebles y Servicios (ITBMS, the Goods and Services Tax) paid on imported goods. - MEF presents Banco Hipotecario Nacional and Banco de Desarrollo Agrícola as unconsolidated institutions within general government, though in other macroeconomic statistics they are classified as public financial corporations; these institutions should not be part of general government. - Functional classification of expenditure prepared by the CG differs from GFSM 1986 recommendations due to use of a national classification driven by SIAFPA limitations. - Public debt statistics follow GFSM 1986 and distinguish between external and internal debt based on place of issuance. ### 2.4 Basis for recording - Flows are valued at market prices for each transaction; gross debt is recorded at nominal value; amounts in foreign currency converted to balboas using midpoint between buying and selling rates of exchange on day of recording. - Transactions in United States dollars are valued at par, reflecting legal parity of Panama’s currency with the dollar. - Recording is on a mixed cash and accrual basis: follows GFSM 1986 except expenditure data for the CG registered on a commitment basis, and MEF interest expenditures include capitalized interest on Inter-American Development Bank loans. - Grossing/netting procedures follow recommendations of GFSM 1986. ### 3. Accuracy and reliability ### 3.1 Source data - MEF uses various internal and external sources to prepare GFS flow data; diversity of sources addresses classification problems in basic information sources. - Sources used in preparing operations tables: - Revenues: basic source for central government operations is the revenue table from the Accounting Directorate of the CG; supplemented by cash flow data from the Treasury Department (DGT) of the MEF and the list of “revenues” (inflows) from the Revenue Department (DGI). For consolidated institutions, their cash flows and the Collections Sheet of the Social Security Fund (CSS) are used. - Expenditures: basic source for central government is the Expenditure by Category report prepared on basis of SIAFPA data; supplemented by DGT cash flow report, Public Credit Directorate (DCP) for interest payments, and Accounting Methods and Systems Directorate (DMSC) of the CG for the list of “expenditures” (outflows). For consolidated institutions, their cash flows are used. - Transfers: basic source is DMSC list of expenditures (from which payroll transfers can be determined); supplemented with data on budgetary subsidies, data on internal interest paid to the CSS prepared by DMSC, and data from the Public Policies Technical Unit (UTPP) on central government transfers to the CSS. - Financing: basic sources are debt reports prepared by DCP and by the Debt Department (DD) of the CG; supplementary information from detailed report of the National Bank of Panama, report of the Savings Fund, and report of the Superintendency of Banks (SBP). The Report on Receipts, Payments and Balances from the project to enhance capital budget execution (Proyecto de Dinamización de la Ejecución del Presupuesto de Inversión) prepared by the UNDP is also used. - CG presents GFS based on budget execution where revenues are recorded on a cash basis and expenditure on a commitments basis. - No information available on transfers for consolidating central government and general government in accordance with GFSM 1986. - MEF’s diversity of sources is sufficient to capture information needed to generate GFS in accordance with international standards and is open and flexible to incorporate new sources or changes. - For public debt, Ministry manages all transactions affecting financial commitments so source data are recorded directly in the compiling unit, the DCP. - Source data used by the MEF reasonably approximate definitions, scope, classifications, valuation, and time of recording required by GFSM 1986. - For GFS prepared by the CG, source data used to prepare NFPS transactions provide expenditure information on a commitments basis as opposed to the cash basis recommended by GFSM 1986. - Budget Law requires detailed budget execution reports to be sent to the MEF, the CG, and the CPAN within 20 days after the end of the month; background information needed to compile GFS is therefore available in a timely manner. ### 3.2 Assessment of source data - No automated system for evaluating source data and no regular evaluation of data reporting forms. - Revisions are made only when errors or inconsistencies are detected; there is constant contact with reporting entities to minimize recording errors. ### 3.3 Statistical techniques - Source data are adjusted using sound statistical techniques that eliminate interinstitutional transfers and transfers between budgetary and non-budgetary activities. - Preliminary data, if published, are replaced by final data in the following publication of respective statistical tables. - Use of a sample for presenting information on decentralized institutions and nonfinancial public corporations creates problems for adjustments needed to incorporate entities outside the sample into overall NFPS results: - Use of financing data from these entities, reversing the sign and adding it to revenues, may resolve surplus/deficit calculation but does not provide sufficient information on structure of revenues and expenditures of institutions outside the sample, and therefore of NFPS. - No adjustment to incorporate the PCA into NFPS accounts, although CG publishes information on PCA operations in a separate table. ### 3.4 Assessment and validation of intermediate data and statistical outputs - No systematic validation of intermediate results, despite variety of data sources; intermediate results are revised only when errors or inconsistencies are detected in final results. - Statistical discrepancies, when detected, are investigated and corrected through necessary adjustments or explained if due to justified methodological differences. - All statistical products relating to fiscal accounts are subjected to regular reconciliation processes, especially between MEF and CG, to detect discrepancies and correct or explain them so consistent series can be published. - External public debt information is validated against data from international agencies and other external institutional creditors from the actual recording of debt transactions. ### 3.5 Revision studies - MEF and CG keep archives of their GFS products and consult them when revisions are undertaken. - Revisions are done only when an error is detected and do not follow any regular program. - Results of analysis and revisions are incorporated into worksheets to prevent repetition of errors and to identify the rule used to correct them, but no report is produced (even for internal use) to systematize revisions. *Source: _cr06387 - 0.4 Other quality management* ### 4. Serviceability ### _cr06387 - 4. Serviceability ### 4.1 Periodicity and timeliness - Flow data compiled by the MEF and the CG meet the periodicity recommendations of the GDDS. - MEF compiles quarterly and annual data for central government, general government, and the NFPS. - CG compiles monthly and quarterly flow data for the budgetary central government, and annual data for the NFPS. - Debt data prepared by the MEF exceed GDDS recommendations: produced monthly and quarterly (the report for the fourth quarter is equivalent to the annual report). - Timeliness of flow data: - MEF quarterly reports are disseminated within 45 days; annual reports within three months. - CG quarterly and annual reports are disseminated within 45 days and 2½ months, respectively. - CG monthly reports appear within five weeks. - Timeliness of MEF debt data: - Monthly information published within three weeks (24 days for the information relating to December). - Quarterly publications within 45 days. ### 4.2 Consistency - Internal consistency within datasets: - Annual data correspond to the sum of quarterly data; quarterly correspond to the sum of monthly data, if published. - Reasonable consistency between flow data (transactions) and stock data (debt). - Aggregates in summary tables correspond to sums of categories in detailed tables. - Temporal coverage and reconciliation: - MEF series cover relatively short periods (generally the total for the preceding year and cumulative to date for the current year). - CG publishes series covering at least five years. - Changes in source data, methodology or techniques are reported in notes to tables, but historical series are not corrected. - Availability of series: - Flow series prepared by the MEF available since 1994. - Flow series produced by the CG available since 1990. - Quarterly debt figures compiled by the MEF are available from 1997. - Monthly debt figures available from August 2004. - Consistency across macroeconomic frameworks: - Public debt data prepared by the MEF are used as the source for compiling the balance of payments statistics. - Flow data reconciled between the MEF and the CG are provided for the national accounts. - Internal reconciliation between MEF and SBP banking-sector statistics is performed via MEF request to SBP, but there is no formal reconciliation procedure between the two entities. ### 4.3 Revision policy and practice - No regular or predefined schedule for data revisions in the MEF or the CG. - Revisions are made only when an error or inconsistency is detected, or when newly compiled information allows updates. - Revisions are reported via notes to the tables containing the new information. - Identification of preliminary and revised data: - Both MEF and CG clearly identify preliminary or revised status of published data. - Preliminary data are regularly replaced by revised data when required information is available. - Studies and analyses of revisions: - Only methodological notes attached to tables are available to users. - No studies have been performed to systematize the revisions that have been made. *Source: _cr06387 - 4. Serviceability* ### 0.2 Resources ### 0.2 Resources ### Human resources - Banking statistics are compiled by Economic Studies Department (Departamento de Estudios Económicos (DEE)), consisting of seven staff and a supervisor. - All staff have university education with specialization in economics, finance, or banking. - Most staff have sufficient experience in compiling statistics and mobility of the staff is low. - Each employee has a personal computer and access to the Internet. - Most staff have attended relevant courses at the IMF and other international organizations. - The number of employees involved in the compilation of monthly and quarterly statistics is adequate. - Salaries are competitive compared to other public and private institutions. - Recruitment and promotion of compilers are based on relevant aptitude and/or expertise in statistics; there is no formal annual performance review. ### Financial and computing resources - Compilers use modern personal computers and adequate software: Excel, Word, Acrobat, and PowerPoint in a Windows environment. - Compilation is performed using a data transmission and compilation system developed internally by the SBP. - Financial resources are broadly adequate to support current programs for compiling statistics. - Workspace is less than adequate to facilitate the efficient compilation of statistics. ### Measures to ensure efficient use of resources - All programs in the SBP are subject to budget considerations and regular performance assessments. - Monthly activity reports (Informes de Gestión Mensual) are prepared by the Economic Studies Directorate (Dirección de Estudios Económicos (DIEE)) and delivered to the General Secretariat (Secretaría General) for monitoring. - Work programs with budgetary requests are prepared annually for approval by SBP management. - Statistical databases are periodically updated to guarantee efficient use of resources. - A data transmission procedure for reporting institutions includes a rich set of validation tests and guarantees absence of processing errors such as accounting, coding, editing, or tabulation errors. - Staff performance evaluations are not conducted periodically (for example, annually). ### Relevance and user engagement - SBP obtains feedback from internal users through an annual evaluation of statistical products. - SBP conducts periodic meetings (once a year) and regular telephone contacts with staff of the CG and MEF to improve quality and timeliness of specific reports required by them. - SBP does not have a proactive policy of regularly consulting private sector users (for example, through regular meetings or a user survey); input from private sector users is limited. - Feedback on relevance is often obtained through responses to specific data requests and consultations. - SBP participates in seminars and conferences organized by international and regional organizations to identify new and emerging data requirements. - SBP plans to compile and disseminate monetary statistics based on internationally accepted standards as a complement to current banking sector statistics. ### Quality management processes - Quality awareness is embodied in the law (Agreement of the Board of Directors, Acuerdo de la Junta Directiva 4-99) which establishes that banks should produce financial statements according to international accounting standards (IAS) or US-GAAP applicable to financial corporations (Article 1). - SBP participates in the GDDS. - SBP holds an annual meeting with staff to improve productivity and quality; each department presents past results and next year work plan. - DIEE participates in the ISO 9000 program. - DEE verifies that data-reporting practices followed by banks are consistent with SBP prescribed guidelines. - DIEE, Information Systems Directorate (Dirección de Informática, DI), and Banking Supervision Directorate meet regularly to assess and improve the data transmission system and discuss changes in data requirements. - DEE carries out detailed analyses of the quality of data processed every quarter, covering detailed and inter-temporal checks to identify systematic errors and provide better instructions to avoid reoccurrences. - When a financial institution does not correct systematic errors, supervisors visiting these institutions include data reporting issues in their agendas. - A Unit of Technical Support (UTS) assists reporting institutions, records frequency of errors by institution and period, and uses records to identify recurrent problems and propose solutions. ### Integrity: professionalism, transparency, and ethical standards - Superintendent’s tenure is five years according to Article 11 of DL-9; Directors’ tenure is eight years (Article 9). - Qualifications and other requirements for hiring the Superintendent and Directors are regulated in Articles 10 and 8; conflict of interest issues are set forth in Article 12; removal of Superintendent and Directors addressed in Articles 14 and 15. - Sources, methods, and statistical techniques used are based on statistical considerations (coverage, timeliness, reliability). - Some dissemination decisions are also determined by regulatory considerations (example: reference interest rates for the local mortgage market must be published quarterly as established by law). - If significant errors in interpretation by the media occur, SBP issues an official response with clarifications. - Public Relations Department prepares an internal bulletin with articles on the financial system appearing in the press, including articles using SBP data sources. - Since publication of the Carta Bancaria together with the data, the number of erroneous interpretations has been reduced considerably. - DL-9 (available on the SBP website) contains terms and conditions under which statistics are collected, processed, and disseminated; Chapter VIII deals with reporting requirements. - All information produced by the SBP is disseminated free of charge. - No government agency outside the SBP has access to banking sector statistics prior to their release. - Officials from CG and MEF who request specific data sets receive them several days after the official release through the SBP website. - Banco Nacional de Panama, Caja de Ahorros, Banco de Desarrollo Agropecuario, and Ministerio de Desarrollo Agropecuario receive the same statistics immediately after their release. - SBP disseminates data to the general public only through its website; all published information bears the SBP logo and SBP is generally identified as source when reproduced externally. - Major changes in banking sector statistics are not always pre-announced; changes such as mergers and acquisitions are published on the SBP website at the time they occur. - Guidelines for staff behavior include Article 12 of DL-9 and Internal Rules of Procedure (Reglamento Interno de Trabajo) No. 14-98 of August 27, 1998 (Chapter 7 rights and obligations; Chapter 9 sanctions). The regulation is made known to staff on joining the institution. ### Methodological soundness — concepts, scope, and classification - Banking sector statistics use international accounting and reporting standards; monetary statistics follow MFSM and SNA 1993. - Banking statistics are geared to identification of main stocks and flow items (balance sheets and profit and loss accounts) and associated risks; monetary analysis focuses on liquidity (broad money) and counterparts (credit and debt aggregates). - The closest analytical account to a depository corporations survey for Panama is the balance sheet of the banks with general license; these include banks that may conduct financial operations with residents and nonresidents. - Banks operating under an international license conduct operations only with nonresident (offshore) entities and should be separated for macroeconomic analysis; they do not issue liquid assets (money) held by residents. - State-owned development banks, the Agriculture and Livestock Development Bank (BDA), and the Mortgage Bank are excluded from SBP regulation and excluded from these statistics. - Data are presented in balboas, the Panamanian monetary unit, which is equivalent to US$1; the monetary agreement with the United States (1904) establishes U.S. dollar is legal tender in Panama; the balboa is a unit of account and the government issues only subsidiary coins. Scope and coverage - Aggregated balance sheet of banks with general license represents more than 90 percent of the depository corporations in the country. - Publication of consolidated groups complements aggregation of individual banks. - Disseminated data on Panamanian financial groups (banks and other financial corporations such as finance and insurance companies) compensate for lack of coverage of subsectors not supervised on an individual basis. - Nonbank depository corporations and other financial corporations not usually belonging to a financial group (such as financial cooperatives and saving and loan associations) are considered negligible or of minor relative importance. - National Bank of Panama (NBP) acts as financial agency for the government in absence of a central bank; responsibilities include banknote exchange and clearing house operations, ensuring adequate supply of U.S. dollars, withdrawing worn U.S. dollar notes and returning them to the United States. - Balance sheet of the National Bank of Panama does not include accounts with the International Monetary Fund, which are recorded off-balance sheet. - NBP publishes its audited balance sheet annually in two national daily newspapers and in its Memoria Anual (Annual Report); balance sheet is presented in balboas and includes notes to the financial statements. - NBP is required to submit balance sheets monthly and quarterly to the Superintendency of Banks; Superintendency disseminates the quarterly balance sheet of NBP in Carta Bancaria and on its web page, with detailed asset and liability components classified as domestic or external and loan portfolio breakdowns. Classification and instrument treatment - Sectoral classification follows MFSM/SNA 1993 residency criterion and provides partial information on counterpart sectors for most instruments. - Monthly balance sheet is published showing main components of assets and liabilities classified as domestic or external. - Liabilities are broken down by type of deposit (sight, time and savings) and deposits are classified by sector (official, of individuals, and of banks). - Quarterly publications provide more detailed information and disaggregated data for each bank under a general license. - Main deviations from statistical standards concern treatment of repurchase agreements, financial derivatives, insurance technical reserves, and accrued interest receivable and payable. - MFSM recommendations noted: (1) classify securities repurchase agreements as loans collateralized with securities; (2) classify financial derivatives and insurance technical reserves as separate category of financial instruments; (3) classify accrued interest on deposits, loans, and securities other than shares together with the financial asset or liability to which it corresponds and not as part of other accounts receivable or other accounts payable. *Source: _cr06387 - 0.2 Resources* ### 2.4 Basis for recording ### 2.4 Basis for recording ### 2.4.1 Market prices are used to value flows and stocks - General recommendation of the MFSM: valuation of financial assets and liabilities should be based on market prices or market-price equivalents (fair values). - Exception: valuation of loans should be based on creditors’ outstanding claims without adjustment for expected loan losses (outstanding principal plus any accrued interest = book value of the loan). - 1993 SNA and the MFSM recommend conversion of financial instruments denominated in foreign currency to national currency values at the mid-point market exchange rate prevailing at the time they are recorded (i.e., on the balance sheet date). - Holding gains and losses from changes in market values (or fair values) should be recorded separately in a revaluation account. - Banks’ balance sheets compiled using the manual of accounts of the SBP (based on IAS) are broadly in accordance with MFSM valuation principles: - Financial transactions recorded at the time they occur (date ownership is registered) and at market prices. - Stocks of financial assets and liabilities are valued at market prices, if possible, or otherwise at purchasing price (e.g., securities bought as a permanent investment). - Foreign currency transactions are converted to national currency at the exchange rate prevailing on the transaction date. - Outstanding stocks of foreign-currency-denominated assets and liabilities are adjusted for exchange rate valuation changes based on end-of-period exchange rates. - Compilers of banking sector statistics do not adjust source data to approximate market valuation or fair values; this is a recommended practice for monetary statistics consistent with other macroeconomic statistics. ### 2.4.2 Recording is done on an accrual basis - MFSM accrual accounting principle: interest accruing on financial instruments should be incorporated into the outstanding amount of the financial asset/liability (i.e., interest accruing before maturity is recorded as a financial transaction representing further acquisition of the financial asset by the creditor and equal incurrence of a liability by the debtor). - Revenue and expenditure should be recorded in the period in which they fall due (accrual basis), regardless of when cash flows occur. - Interest in arrears continues to be recorded until paid or written off. - Current practice deviations: - Accrual accounting principle is not fully applied in banking sector statistics compilation. - Accrued interest of financial assets such as securities held by financial institutions is classified under other accounts receivable/payable and not with the underlying instrument (contrary to MFSM recommendations). - Interest in arrears for more than three months is no longer included in the balance sheet but recorded off-balance sheet. ### 2.4.3 Grossing/netting procedures are broadly consistent with internationally accepted standards, guidelines, or good practices - General principle of MFSM and 1993 SNA: data be collected and compiled on a gross basis—broadly applied in SBP banking sector statistics. - Assets and liabilities are compiled on a gross basis and aggregated into a balance sheet without consolidating interbank positions. - SBP does not disseminate analytical accounts of the banking sector on a consolidated basis (depository corporations survey, DCS). - According to MFSM guidelines, the DCS is obtained by canceling outstanding claims and liabilities between all depository corporations while preserving presentation of claims on (and liabilities to) other financial corporations subsectors, other domestic sectors, and nonresidents. ### 3. Accuracy and reliability — Source data and assessment #### 3.1 Source data - 3.1.1 Source data are obtained from comprehensive data collection programs that take into account country-specific conditions: - Financial system dominated by banks, which account for more than 90 percent of the depository corporations according to MFSM definition. - Source data for compiling banking sector statistics by the SBP are obtained from comprehensive data collection programs tailored to Panama. - Data collection program does not include depository corporations that are not banks (financial cooperatives, saving and loan associations, money market investment funds, etc.) or other financial corporations (insurance companies, pension funds, development banks, finance companies, investment funds other than money market, etc.). - Offshore banks (international license) are included in the statistics and should be considered separately because they cannot accept deposits from residents. - Accounting records used (átomos—chart of accounts and complementary information on loans, securities and liquidity operations) broadly contain sufficient detail to classify data by financial instrument and economic sectors as defined in the MSMF. - The SIB maintains the chart of accounts and accounting practices used by banks. - Developments in the financial sector outside the banking sector are not monitored by the SBP because they are not covered by its mandate. - 3.1.2 Source data reasonably approximate required definitions, scope, classifications, valuation, and time of recording: - Residency criterion, classification of instruments, and identification of institutional sectors are in broad compliance with MFSM recommendations. - Exceptions: financial derivatives and insurance technical reserves cannot be fully identified, though their relative importance is small. - Chart of accounts follows international accounting standards but lacks distinction between assets/liabilities denominated in national currency (balboas or US dollars) and in foreign currency (other than US dollars), preventing analysis of currency mismatches; relative importance of non-US dollar currencies is considered very low. - Chart distinguishes, within financial sector, between banks and other financial corporations; SBP does not compile aggregate measures of liquidity such as monetary aggregates—including broad money—which likely justifies chart distinction between supervised and not supervised institutions. - 3.1.3 Source data are timely: - Monthly data, including balance sheet and complementary information (átomos), are received from banks 10 working days after the end of the reference month. - A system records errors and reporting delays; all data are received electronically. #### 3.2 Assessment of source data - 3.2.1 Routine assessment: - Source data are assessed and updated through qualitative information about authorization of new entities, creation of new instruments, new operations, and other SBP responsibilities. - Compiler visually validates banks’ balance sheets and complementary information after automatic arithmetic and logic validation tests by data transmission software. - Data accuracy is routinely reviewed for internal consistency; inconsistencies and out-of-value trends are discussed with reporting institutions through the Extra Situe Supervision Department (ESD) and written records are kept. - Communication between DEE and supervision departments (Extra and In Situe) exists regarding new or complex operations. - SBP policy prohibits direct contact between banks and compilers; all consultations routed through ESS in written form—this may lack flexibility for high-frequency data such as interest rates statistics. - Recommendation: if SBP plans to compile and disseminate weekly interest rates, consider allowing direct contact—including by phone—between compilers and banks; a record of compiler queries may substitute for written procedure. #### 3.3 Statistical techniques - 3.3.1 Data compilation techniques: - Compilation techniques are automated, reducing processing errors related to codification, tabulation, and revision. - DI filters information electronically with a computerized system that validates using around 40 tests for each reporting institution. - If a financial institution fails to report on time, DEE estimates its position by copying the latest reported data so aggregates can be prepared on time; received data later replace estimates. - Banks in compulsory liquidation do not report through regular procedures and DEE does not apply statistical technique to preserve time series; such compulsory liquidations have been very rare (only three in the past 30 years). - 3.3.2 Other statistical procedures: - Unusual to make statistical adjustments or estimates for banks’ balance sheets and banking sector aggregates due to accounting basis of source data. - Source data are presented in national currency and include transactions based on conversion of foreign exchange into local currency using the official end-of-month exchange rate. - Banking sector statistics disseminated by the SBP are not subject to seasonal adjustment. #### 3.4 Assessment and validation of intermediate data and statistical outputs - 3.4.1 Intermediate results validation: - MFSM recommends two levels of compilation (sectoral balance sheets and consolidated surveys); SBP compiles and presents only balance sheet form, not survey format—thus no intermediate statistical output strictly speaking. - Monthly information is validated against more detailed quarterly data when received; no other sources available for cross-checking. - 3.4.2 Monitoring statistical discrepancies: - No automatic checks to monitor trends in time series; trends are scrutinized visually. - End-of-year special investigation assesses adjustments made in the end-of-year balance sheet; DEE monitors monthly changes in stock of securities to ensure they reflect real operations. - 3.4.3 Investigation of discrepancies: - Large discrepancies and other potential problems are routinely investigated; DEE checks statistical products and explains unusually large fluctuations. - Data from banks are checked to prevent discrepancies due to classification errors or omissions; process involves analysis of loans by type of economic activity and quality of credit and analysis of investments in securities by type and investment category. #### 3.5 Revision studies - 3.5.1 Revision analysis: - Banking sector statistics are not subject to formal revision cycles; data are deemed final when first released. - Report recommends SBP substantially improve timeliness of disseminated data (from 6–8 weeks to four), resulting in dissemination of preliminary data subject to revisions. - Investigations to improve data quality are conducted on an ad hoc basis to evaluate sources of problems (e.g., inconsistencies between monthly and quarterly data); corrective procedures are implemented once sources are identified. - Banks may revise their data, more frequently in profit and loss account items (gains/losses in securities trade, gains/losses in exchange rate conversion, losses due to bad loans) than in balance sheet; revisions concentrated in end-of-fiscal-year data, which may or may not coincide with end of calendar year. ### 4. Serviceability #### 4.1 Periodicity and timeliness - 4.1.1 Periodicity follows dissemination standards: - Periodicity of banking sector statistics, including the NBP, meets GDDS recommendations, i.e. monthly data. - 4.1.2 Timeliness follows dissemination standards: - Timeliness of monthly banking sector statistics is consistent with GDDS recommendations (two to three months). - SBP publishes data for individual banks, including the NBP, six weeks after the end of the reference month. - Aggregated data are disseminated two months after the end of the reference month. - More detailed quarterly data are published two months after the end of the reference quarter. - Despite meeting GDDS, authorities do not regard timeliness as a top priority; banks report data promptly (10 working days, or two weeks, after the end of the reference month). - Receipt and compilation of statistics is fully automated with checks and validations; dissemination occurs six weeks after the end of the reference period—about two weeks later than other countries with financial systems of similar development. #### 4.2 Consistency - 4.2.1 Internal consistency: - Banks’ records of claims on, and liabilities to, each other show discrepancies due to differences in time of recording; discrepancies are not significant and operations in transit are detected and corrected. - 4.2.2 Consistency over time: - Available monthly banking sector data begin in 1970 and are reconcilable, although early data are very aggregated. - Data disseminated to the public begin in December 2001; older series are internally available in paper but not disseminated. - SBP plans to construct longer time series and publish these data in the near future. - 4.2.3 Consistency with other data sources/frameworks: - Banking sector statistics disseminated to the public are not reconcilable with those obtained through other data sources because the analytical framework does not correspond to macroeconomic analysis (not SBP mandate). - It is not possible to fully reconcile net foreign assets with corresponding items in balance of payments statistics, although residency criterion is followed in both; SBP and CG regularly verify consistency between banking sector statistics and balance of payments. - Criteria to sectorize the economy for banking sector and fiscal data are consistent. - Difficult to fully reconcile banking sector statistics with fiscal data (e.g., net credit to government) because accrual recording is largely used in banking sector statistics and cash recording in fiscal data; analytical framework for banking statistics does not facilitate reconciliation with fiscal data, including on public nonfinancial corporations. *Source: _cr06387 - 2.4 Basis for recording* ### 4.3 Revision policy and practice ### 4.3 Revision policy and practice ### Revisions follow a regular and transparent schedule - Monthly banking sector statistics compiled by the SBP are deemed final when published; therefore, there is no need for a regular and permanent revision schedule or implementation of a revision policy at this moment. - If the SBP decides to disseminate more timely data, a revision policy may need to be defined. - Monthly statistics are reviewed every quarter by comparison with the more detailed quarterly data that banks are obliged to report to the SBP. - If significant changes in the monthly data occur, users are notified by means of footnotes. - The content of the statistics is reviewed on a continuous basis, particularly by contrasting monthly and quarterly data. ### Preliminary and/or revised data are clearly identified - Disseminated data are always final. - From the perspective of the SBP, preliminary data do not exist because compilers only publish data that have been already validated and approved by the corresponding department in the SBP. ### Studies and analyses of revisions are made public (see also 3.5.1) - Revisions are extremely unusual owing to the SBP policy of publishing only final data; therefore, studies and analyses of revisions that occasionally take place are not for publication. - The SBP intends to produce and publish analyses of revisions if the decision is made to disseminate preliminary data more timely than is currently the case (i.e., shortening the publication lag for aggregated data from two to one month after the end of the reference month). ### 5. Accessibility ### 5.1 Data accessibility - Presentation: - The presentation of banking sector statistics facilitates interpretation and allows monitoring of banking sector and financial developments. - The data disseminated on the SBP website contain tables presenting data in a clear and user-friendly layout. - The website contains more detailed monthly and quarterly data for the last five years. - Dissemination media and format: - The media used are adequate for users who have access to the Internet; both recent and (limited) historical data can be consulted on the SBP website (http://www.superbancos.gob.pa). - The use of PDF files without spreadsheets is not recommended by international best dissemination practices. - Release schedule: - There is no preannounced advance release calendar to the public. - DEE follows an internal production and publication schedule and dissemination is done at regular intervals (monthly and quarterly). - Simultaneous availability: - Monthly and quarterly banking sector statistics are disseminated simultaneously to the public on the SBP website. - Owing to occasional longer-than-usual delays in dissemination, some users in the public sector have obtained data before their dissemination. - Non-routinely disseminated data: - Unpublished (but nonconfidential) data are made available upon request from the DEE, with the approval of management. - All information requested by users is free of charge. - The SBP website has a facility for users to send questions or queries to the SBP. - The SBP does not inform users of the availability of data online or of their content, such as the degree of detail available or the length of the historical series. ### 5.2 Metadata accessibility - Documentation: - The SBP does not provide users with methodological notes on banking sector statistics. - The banking law available in the SBP webpage contains descriptions on classification of loans, securities, capital adequacy and other topics that inform on the methodology for presenting the data. - The SBP maintains updated metadata in the GDDS country page, but a link from the SBP webpage to the IMF’s GDDS webpage does not exist. - Levels of detail: - Detailed methodological notes describing the main concepts and definitions of the disseminated data are not available for the specialized user. ### 5.3 Assistance to users - Contact points: - Internal users in the SBP get support from compilers at DEE. - External users may send queries through the SBP website (link: “contactenos”) or by phone. - Written replies to user queries are made in less than three days. - The GDDS metadata identifies the director of the DIEE as the contact person for queries on the statistics disseminated by the SBP. - Catalogs and publication channels: - The SBP’s website is the only dissemination channel used by the SBP to inform the public about banking sector statistics. *Source: _cr06387 - 4.3 Revision policy and practice* ### 0.3 Relevance ### 0.3 Relevance ### 0.3.1 Monitoring relevance and user engagement - The BOPS maintains a close dialogue with data users through bulletins, pamphlets, and information on the CG Internet website. - No formal monitoring procedures for data users are in place. - A calendar for data dissemination is made available to the press; the e-mail address is included in every note sent to users. - The DSC holds seminars and meetings with reporters and users of balance of payments statistics. - Metadata on compilation methodologies are disseminated in the Balanza de Pagos, Estadística Panameña, and the General Data Dissemination System (GDDS) webpage. - Data publications identify a responsible staff member for each time series and invite questions; the balance of payments unit commits to answering such queries within seven working days. - Staff in charge of balance of payments compilation regularly participate in statistical meetings and seminars organized by international/regional organizations or professional organizations. - A structured and periodic consultation process takes place with policy departments/ministries and other principal data users. - Through the Project for Preparation of the NSSD, feedback mechanisms have been established to reinforce the National Statistics System (NSS), standardize statistics, and reinforce statistical management capacities among national and international organizations. ### 0.4 Other quality management #### 0.4.1 Processes to focus on quality - CG management promotes concern for all dimensions of data quality; strategic plans set main objectives for each unit and are evaluated periodically. - Staff training programs emphasize quality and methods for achieving data consistency. - DSC is implementing a database (INFODEC) within the context of the NSSD to allow timely and consistent statistics production. #### 0.4.2 Processes to monitor quality of the statistical program - The BOPS prepares monthly reports to DCS management summarizing the status of all activities (surveys), including forms sent out, received, pending receipt, analyzed, tabulated, etc. - Compiling areas have access to expert guidance and regular communication with IMF experts. - Periodic reviews have been undertaken to identify steps necessary to maintain quality, but there are no such reviews at the present time. #### 0.4.3 Processes to deal with quality in planning - Explicit processes are not in place, but DSC evaluates work programs to identify shortcomings and the need to apply standards to improve data quality. - Plans to overcome large revisions in balance of payments statistics are currently under consideration. ### 1 Assurances of Integrity #### 1.1 Professionalism - Legal provisions give the CG professional independence; the law establishes, recognizes, and respects professional independence. - Management positions within the DSC are subject to replacement, yet professional independence is maintained. - Professionalism is evident from adherence to international methodologies and recommendations. - The CG law does not specify the term or hierarchical level of the DSC head, but his professional independence is maintained. - Recruitment uses job profiles for each area; there is a promotion policy of classification and reclassification of positions, and a performance appraisal system that provides for salary increases every two years. - A training committee evaluates and plans training nationally and internationally, including balance of payments methodology for suppliers and users. - Time devoted to research and information analysis has been limited owing to growing demand and new methodologies. #### 1.1.2 Source and technique choices - DSC staff have independence in choosing data sources; choices are based on statistical considerations as specified in the Decree of 1960 (Article 13). - No interference from other agencies in choice of data sources and compilation methods. - Selection criteria: data quality, availability, timeliness, cost, and data needs, guided by international standards. - Users are informed in advance of dissemination timetable via the Advance Release Calendar, which is sent to the press. - Within resource limits, timing, methods, and other dissemination decisions are based solely on statistical considerations. #### 1.1.3 Commenting on misuse - The DSC provides explanatory materials and briefings (press releases and comments) to prevent misinterpretation or misuse of statistics. - No formal policy or well-established custom exists to deal with misinterpretation/misuse; authorities respond by clarifying or confirming results when errors are detected. - The Social Communications Directorate maintains a monitoring system for tracking news reports in television and the printed press. ### 1.2 Transparency - The CG, through its Social Communications Directorate, informs the public about terms and conditions under which it operates via press releases, meetings, lectures, and conferences. - Names of contact persons for each subject field are published in balance of payments publications. - Transparency is guaranteed by CG’s Law; data are published in printed bulletins and disseminated electronically, by e-mail, and on the Internet. - Confidentiality governed by Article 12 of the Decree of 1960 and Article 17 of Decree 7. - Terms and conditions under which statistical series are compiled and disseminated are commonly presented during CG seminars. - Although additional information about the DSC and its products is available on demand, this information is not widely publicized in publications. - Internal governmental access prior to release: in previous years senior authorities had prior access; currently information is delivered simultaneously to all users. - Statistical products are clearly identified with logos, letterhead, and names; joint publications identify all agencies involved and the DSC requests that the source be cited when data are used by another entity. - Advance notice of major changes in methodology, source data, and techniques is given only on exceptional occasions (e.g., bulletins, briefings, news releases); bulletins have included “explanatory notes” reporting methodology changes (e.g., CFZ recording, bank transactions). ### 1.3 Ethical standards - The Uniform Code of Ethics for Public Servants applies to the central government and thus to the CG; every employee receives a copy of the Code of Ethics and of the Internal Bylaws, which are strictly enforced. - Staff are reminded periodically of standards via memoranda and working meetings. - Article 21 (Independencia de criterio) requires public servants to avoid situations, activities, or interests incompatible with their functions or implying conflict of interest and to abstain from conduct affecting independence of judgment. - Article 28 prohibits using information available by reason of duties for personal benefit or that of third parties, or for purposes other than official ones. - Ethics is one of the Ten Commandments in the CG; new and current staff are periodically reminded of the importance of observance of ethics to achieve institutional excellence. ### 2 Methodological Soundness #### 2.1 Concepts and definitions - Structure, concepts, and definitions largely follow Balance of Payments Manual, fifth edition (BPM5) guidelines; double entry system applied with statistical discrepancies recorded in errors and omissions. - Residence of offshore entities and enterprises operating in free trade zones is attributed to the economy in which they are located. - Data distinguish between income components and goods and services components; financial account records foreign financial assets and liabilities separately. - Investment in construction is not currently recorded, although a business registry of construction exists. - Direct investment is recorded on a directional basis; direct investment of residents abroad is not recorded. - Resident institutional units are defined in conformity with BPM5; resident holdings of external debt instruments issued by the government are not excluded from the balance of payments. - One-year rule is applied for residence status of individuals (with exceptions for students and persons requiring medical treatment abroad). - The compilation methods do not deviate from BPM5 concepts and definitions in principle. - For foreign direct investment transactions Panama applies the 10 percent ownership rule. - For reserve assets: Panama has no central bank; deposits held abroad of the NBP (a government owned bank) are treated as international reserves. The Trust Fund that the government keeps on deposit with fund administrators is treated as a reserve asset. #### 2.2 Scope - In principle, all resident-nonresident transactions specified in BPM5 are covered. - Coverage improvements needed for shuttle trade, mineral exploration, purchase of computer software packages (a survey of firms engaged in this activity is now under way), e-commerce transactions, temporary workers abroad, and leases. - Resident institutional units engaged in transactions with nonresidents are covered in principle. - Lack of data on unrecorded trade and non-financial private debt is not recorded. - BOPS is making efforts to obtain information on temporary workers from the household survey, and other business, construction, and computer and information services through enterprise surveys. #### 2.3 Classification/sectorization - Classification and sectorization broadly comply with BPM5 guidelines; institutional units classified according to BPM5. - Both analytic and standard presentations of the balance of payments and IIP are available on a quarterly and annual basis in DSC publications. - Transactions are classified by relevant items, with sectoral breakdown by sector of the transactor. - License fees for fishing and hunting are not recorded in the balance of payments. - No major classification problems arise from data sources. #### 2.4 Basis for recording - 2.4.1 Market prices - Basis for recording is mixed; principle of market valuation is generally used. - When no market prices are observed, prices of similar transactions or best estimates are used as proxies. - Value of transactions is reported separately from related charges, fees, and transaction services. - When transactions are calculated from changes in stocks, calculations exclude valuation and other changes. - External debt is recorded at face value when issued, but adjusted to market value when redeemed. - BOPS compiles balance of payments data in balboas, which are equivalent to U.S. dollars. - Most transactions are in U.S. dollars; when not, data are converted to dollars at the exchange rate in effect on the date of the transaction; if transaction date cannot be precisely determined, the average midpoint exchange rate for the reporting month is used. - Some financial account flows are derived from monetary statistics stocks already in U.S. dollars; source data from the SBP allow exclusion of changes due to prices, cross-exchange rates, and other variations. - 2.4.2 Accrual basis - Recording is mostly on an accrual basis; however, interest on external public debt and dividend payments are recorded when paid. - The accrual basis is only approximately achieved in some sources. - Merchandise trade statistics are recorded according to customs clearance time, which may differ from change of ownership. - Services, income, and transfers are cash-based, as are equity and reinvested earnings of the private nonbank sector. - Overall, efforts are made to use the accrual principle. - 2.4.3 Grossing/netting procedures - In line with BPM5 recommendations, current and capital account transactions are recorded on a gross basis. - Financial account transactions are recorded on a net basis, separately for individual asset and liability components. *Source: _cr06387 - 0.3 Relevance* ### 3.1 Source data ### 3.1 Source data ### Source data composition and coverage - Source data are obtained from comprehensive data collection programs that take into account country-specific conditions. - Composition of data sources (surveys and administrative records) is adequate, but does not cover some private sector services and financial transactions. - Shortcomings in source data from the CFZ hamper adequate trade estimates. - Temporary discontinuation of some surveys, due to budgetary restrictions in the last two years, contributed to the shortcomings. - The DSC is working to overcome these problems and to include new transactions relating to emerging activities of impact on Panama’s economy. - Established procedures provide for frequent integration of new transactor units into the register(s) and accounting of mergers, cessation of operations, and other changes. - Primary institutional sources listed: - National Bank of Panama - SBP, formerly the National Banking Commission - Directorate of Public Credit of the MEF, formerly the Ministry of Planning and Economic Policy - Superintendency of Insurance - PCA, formerly the Panama Canal Commission - U.S. Embassy - BOPS also obtains information from other departments of the DSC (foreign trade and migration statistics) and other directorates of the CG (external debt), and conducts surveys and special research on services, income, current transfers, and private nonbank financial flows. ### Goods (current account) - DSC bases current account goods data on trade statistics from customs documents. - Adjustments made to eliminate double counting of trade between the CFZ and the rest of Panama. - Beginning with 2001, trade statistics include imports by the PCA. - For goods procured in Panamanian ports by foreign carriers, DSC obtains data on: - direct sales by private enterprises (bunker oil) - oil companies (aviation fuel) - surveys of agents of foreign airlines and shipping companies (other supplies) - From 1997 onwards, adjustments are made for electricity trade between Panama and Central America, and goods for processing derived; these estimates are derived from trade declarations. ### Services - Transportation: - Freight on imports from customs declarations. - Passenger services from surveys of national airlines and agents of foreign airlines. - Port services from agents of foreign air and shipping lines, national airlines, container terminals ports, and the PCA (tolls and other services to Canal users). - Travel: - Sample surveys conducted in conjunction with the Panamanian Tourism Institute on expenditures of foreign visitors in Panama and Panamanian residents abroad. - Information derived from migration statistics on the number of travelers. - Telecommunications: - Data for both credit and debit entries include estimates of new telecommunications agencies. - Insurance: - Credit entries: net premiums on direct insurance and reinsurance assumed by Panamanian insurance companies, based on Superintendency of Insurance data. - Debit entries: premiums on merchandise insurance on imports derived from trade statistics, adjusted to exclude insurance collected by resident insurers and net reinsurance premiums ceded to foreign companies. - Financial services: - Data mostly cover commissions and other financial services provided or received by general license and international license banks, as reported to the SBP. - Other business services: - Obtained through BOPS surveys of nonfinancial enterprises, including those operating in the CFZ. - Government services: - Until 1999, credit entries mainly covered acquisition of goods and services in Panama by U.S. military establishments in the Panama Canal Area (data from U.S. Embassy). - BOPS takes data on Panamanian government expenditures abroad from the Directorate of Accounting of the CG. ### Income - Until 1999, DSC obtained data on compensation of employees from the U.S. Embassy in Panama (wages paid to Panamanian residents by the U.S. Defense Department and some other U.S. agencies in the Panama Canal Area). - Currently, a set of embassies are being surveyed. ### Capital and Financial Accounts — Direct investment - Entries for direct investment in Panama cover transactions of nonfinancial corporations (including those in the CFZ), the PCA (until 1999), general license banks, and international license banks. - Until 1999, sources included annual surveys by the DSC, annual report of the PCA, and consolidated balance sheets and income statement data of general and international license banks provided by the SPB. - No data are available on direct investment abroad by Panamanian residents. - Direct investment enterprises are defined as those in which a foreign investor has an equity participation of 10 percent or more. ### Capital and Financial Accounts — Portfolio investment - Assets: - Entries for bonds and notes of the banking sector derived from consolidated balance sheets of general license and international license banks provided by the SBP. - Entries for bonds and notes of other sectors from the quarterly enterprise survey. - Beginning in 2002, the Coordinated Portfolio Investment Survey has been implemented; BOPS expects to include results (position data) in the IIP statistics starting in 2006. - Liabilities: - Data on general government bonds and notes from the Directorate of Public Credit of the MEF. - Data include new bond issues for rescheduling debt in arrears, repurchases and exchanges of new bonds, repayments on previous issues, and repurchases and swaps of new bonds. - Recording of interest on external public debt is made on a cash basis and not excluding resident holdings of external public debt. - The NBP provides information on the government trust fund which is kept off-balance-sheet by the NBP but included in official reserve assets in the balance of payments and IIP. ### Capital and Financial Accounts — Other investment - Monetary authorities: data derived from the balance sheet of the NBP. - External debt transactions of general government and decentralized institutions obtained from the Directorate of Public Credit of the MEF. - Banks’ short-term loans, other assets, and other liabilities may include long-term transactions, but separate information has not been recorded as such. - Liabilities of other sectors drawn from DSC surveys. - Non-financial private debt is not recorded. ### Current transfers - Since 1997, distinction made between current and capital transfers in line with BPM5 recommendations. - Credit entries for current transfers of general government include grants received from the U.S. Agency for International Development and other organizations such as IADB, PNUD, WHO, and OAS. - Since 2001, data on workers’ remittances (credit and debit) derived from quarterly surveys of money changers. - Other transfers (credits) cover mainly pensions paid by the U.S. government to residents of Panama who worked for U.S. government agencies in the former Panama Canal Zone. ### International reserves and International Investment Position (IIP) - International reserves entries refer to the Government’s Trust Fund and foreign exchange assets of the NBP. - Reserve asset entries are defined as the changes in stock at the end of each year as a result of transactions. - In 1996, BOPS started compiling and publishing annual IIP statistics in the bulletin Estadística Panameña–Situación Económica, Balanza de Pagos and Estadística Panameña. - IIP data sources are the same as those used in compiling the balance of payments. ### Source data quality, definitions, and timeliness - Specific procedures have been developed to adjust data from various sources to improve coverage, classification, and valuation to conform with BPM5 guidelines. - Administrative records used reasonably approximate BPM5 methodological requirements. - Data collection and processing timetables are adequate to meet timeliness and periodicity for disseminating balance of payments statistics. - Respondents are made aware of reporting deadlines through circulars and documents; DSC employs rigorous follow-up procedures (personal and written contact). ### Assessment of source data and routine evaluation - Accuracy of survey data is routinely assessed to monitor sampling and non-sampling errors. - Comprehensive checks for internal consistency are conducted; routine queries are made when large transactions occur. - Effects of questionnaire changes on survey estimates are assessed by testing data consistency. - Source data are analyzed in the context of revisions. - Revision policy: - Estimates are corrected after three quarters. - Final estimates are provided six quarters later. - Comparative tables (absolute or percentage values) are produced from generated data. - Intensive contact maintained with respondents. ### Statistical compilation techniques and adjustments - Compilation procedures for surveys and administrative records are sound and generally consistent with international practices. - Reconciliation of quarterly and annual data uses simple procedures. - No comprehensive estimates of border transactions and smuggling are made. - Compilation procedures minimize processing errors (coding, editing, tabulation); cover logic, empirical discrepancies, and consistency between periods. - Adjustments to unit records are made only when clearly warranted and can be identified in datasets. - In current quarters, adjustments are made only when there is a change in the position of the main aggregates; other changes follow BOPS review criteria. - When nonsampling errors become large, repetition of logic checks and grouped-level procedures are used. - Sound estimation techniques employed to adjust for missing observations per BPM5 recommendations. - Discrepancies between the sum of quarterly data and annual data are removed through benchmark procedures or indicators, particularly adjusting the fourth quarter to reconcile annual and quarterly data. - Annual data surveys considered more reliable because they are based on audited balance sheets. ### Specific data transformations and consistency checks - Quarterly adjustments to trade data convert imports from c.i.f. to f.o.b. using Customs Office data detailing insurance and freight provided by the reporter. - Data on imports from the rest of Panama and the CFZ (from 1998 onwards) are available both on f.o.b. and c.i.f. basis and are classified in the services account per BPM5 guidelines. - No adjustments to the trade database are made on the basis of direction of trade; no estimates of non-recorded trade. - Consistency checks focus on definitions, valuation, reference periods, and classifications. ### Validation of intermediate results and investigation of discrepancies - Intermediate results are validated against other information where applicable (e.g., media reports on foreign direct investments). - Private sector interest data are not cross-checked with income taxation registers. - Intermediate results are checked only when extreme values are observed. - Cross-check verifications with other administrative records from government agencies are insufficient. - Travel-related transaction data are analyzed in relation to customs and immigration statistics on international traveler numbers. - Net errors and omissions magnitude and sign are determined and investigated to understand potential statistical deficiencies. - No comparisons are made between external debt data and data compiled jointly by the World Bank and IMF. - No bilateral data reconciliations conducted for selected trade; only reconciliations with data from international agencies. ### Revision studies and documentation - Internal records of revisions are kept, but no formal analysis of revisions and their magnitude is conducted. - Every revision process is used to improve coverage and quality. - BOPS does not analyze time series but analyzes adjustments needed to enhance accuracy. - Adequate documentation on revisions is maintained and includes descriptions of causes of revisions, methods used to incorporate new data sources, and ways in which data are adjusted. ### Serviceability — periodicity and timeliness - Periodicity of balance of payments statistics exceeds GDDS standards: quarterly and annual data compiled and disseminated for balance of payments and IIP statistics. - Timeliness: - Quarterly balance of payments statistics disseminated within one quarter after the reference period, exceeding GDDS recommendations. - Annual balance of payments statistics disseminated three months after the end of the reference period. ### Consistency - Concepts, definitions, and classifications for producing quarterly and annual statistics are the same. - Annual statistics are the sum of quarterly statistics; annual data are allocated to quarterly data using appropriate methods. - Net errors and omissions item has been stable and not large over the long run, except for 1988 and 1991. - Financial flows are reconciled with changes in the IIP; bulletins publish tables with initial position, transactions, other changes, and final position each year. - When changes in source data, methodology, or techniques are introduced, historical series are reconstructed as far back as reasonably possible (e.g., reconstruction back to 1990 when adopting BPM5). - Detailed methodological notes accompanying quarterly data identify and explain main breaks and discontinuities and adjustments made; explanations on unusual trends provided in analytical publications but not included as a component in the public database. - Reconciliation with other datasets: - Balance of payments trade in goods data is not reconciled with international merchandise trade data. - Balance of payments statistics are largely consistent with national accounts statistics. - Banking sector transactions in balance of payments are largely consistent with monetary and financial statistics. - Public external debt data prepared by MEF are used as a source for compiling balance of payments statistics, making them consistent with GFS. *Source: 3.1 Source data (Balance of Payments Statistics)* ### 4.3 Revision policy and practice ### 4.3 Revision policy and practice ### Revision schedule and transparency - The revision cycle is predetermined and reasonably stable from year to year. - The revision cycle for balance of payments statistics follows a schedule established in advance of the following year. - The revision cycle is not made known to the public. - As soon as revisions are made, the public is notified in printed form and on the CG’s web page. - Every time the balance of payments is disseminated, whether as preliminary or revised data, commentary is included with the data through a press release. - A schedule prepared by the DSC and provided to the press announces in advance the dates the statistics are to be released and is published on the CG’s web page in the first week of January. - The statistics are released punctually according to the pre-announced schedule. - The data are released simultaneously to all interested users on the date and/or time specified in the pre-announced schedule; the press is not briefed in advance. - There is no prior access to balance of payments data by the government, or any other party not involved in compilation, verification, and dissemination. ### Identification of preliminary and revised data - At the time of data dissemination, users are informed whenever data are preliminary; preliminary data are printed with a reference mark (P). - When revisions are made a reference mark (R) is placed in the tables, indicating that the data have been revised. ### Revision studies and documentation - There are no formal studies or analysis of the revisions; thus no documentation is published. - Internal records of revisions are available, but no formal analyses are conducted to keep record of revisions and their magnitude. - Assessment table notes: "Studies and revision analysis are not made public. No formal analyses of revisions are conducted." --- ### Accessibility ### Data accessibility — presentation, media, release practices - Balance of payments statistics are disseminated according to the standard components of the BPM5 and with time series. - The BOPS disseminates the balance of payments according to both the standard and analytic presentations following BPM5 recommendations. - Additional series are disseminated to meet a range of user needs with various levels of detail, particularly trade data. - Charts and tables in the quarterly and annual bulletins facilitate analysis; commentaries on current-period developments are always included. - The Social Communications Directorate (DSC) disseminates the balance of payments statistics to the press and media through a press release. - Data are disseminated on the CG website with the required timeliness as specified in the advance release calendar of statistics provided early in the year. - The same data are published in the quarterly and annual bulletins. - Recent data can be consulted free of charge via electronic formats. - Printed publications: some are distributed free and others for a price; time series printed in the bulletins are sold to the public. - Unpublished non-confidential specialized tabulations can be provided at no charge upon request, though availability of non-published statistics is not publicized; users are informed of relevant contact information. - Assistance requests are handled through the Statistical Information Center of the CG; internal by-laws stipulate that requests must be handled within seven working days. - The CG provides a list of balance of payments publications, documents, and other services and updates them each year; a list of publications is available on its website and prices of statistical products and services are clearly disclosed. ### Metadata accessibility — documentation and dissemination - In annual DSC publications such as Situación Económica, Balanza de Pagos, a comprehensive sources and methods section is published and updated regularly. - Metadata include information on concepts, definitions, classifications, data sources, compilation methods, statistical techniques and other relevant methodological aspects and procedures. - The CG does not disseminate balance of payments metadata on its website (note in table: metadata published in biannual reports; the electronic website lacks this information). - GDDS metadata and other related descriptions are reviewed and updated regularly. - A comprehensive sources and methods document and brochures inform users; these documents are updated regularly. - Starting May 15, 2006, metadata on balance of payments has been posted on the CG’s website. - Plans noted elsewhere: In May 2006, a list of contacts for each statistical sector was added on the CG website; plans to improve presentation and access to CG’s website are to be undertaken in August 2006; in July 2006, balance of payments metadata are to be added to the CG website. ### Assistance to users and outreach - Prompt and knowledgeable service and support are available; material to raise awareness on the use of statistics is available. - The DSC is working with the Ministry of Education on a program to promote a statistical culture. - Assistance to users is monitored and reviewed periodically through the Integrated System of Correspondence (SICO) of the CG. - Brochures inform general users about the balance of payments and other external sector statistics. - Only non-confidential data are provided on request. *Source: _cr06387 - 4.3 Revision policy and practice* ### 3.3 Statistical techniques— ### 3.3 Statistical techniques— ### Statistical techniques and validation - Statistical techniques employed conform to sound statistical procedures. - 3.3.2 Other statistical procedures (e.g., data adjustments and transformations, and statistical analysis) employ sound statistical techniques. - 3.4.1 Intermediate results are validated against other information where applicable. - 3.4.2 Statistical discrepancies in intermediate data are assessed and investigated. - 3.4.3 Statistical discrepancies and other potential indicators or problems in statistical outputs are investigated. - 3.5.1 Studies and analyses of revisions are carried out routinely and used internally to inform statistical processes (see also 4.3.3). ### Assessment, validation, and revisions (quality dimensions) - 3.4 Assessment and validation of intermediate data and statistical outputs—Intermediate results and statistical outputs are regularly assessed and validated. - 3.5 Revision studies—Revisions, as a gauge of reliability, are tracked and mined for the information they may provide. - 4.1 Periodicity and timeliness—Periodicity and timeliness follow internationally accepted dissemination standards. - 4.1.1 Periodicity follows dissemination standards. - 4.1.2 Timeliness follows dissemination standards. - 4.2 Consistency—Statistics are consistent within the dataset, over time, and with major datasets. - 4.2.1 Statistics are consistent within the dataset. - 4.2.2 Statistics are consistent or reconcilable over a reasonable period of time. - 4.2.3 Statistics are consistent or reconcilable with those obtained through other data sources and/or statistical frameworks. - 4.3 Revision policy and practice—Data revisions follow a regular and publicized procedure. - 4.3.1 Revisions follow a regular and transparent schedule. - 4.3.2 Preliminary and/or revised data are clearly identified. - 4.3.3 Studies and analyses of revisions are made public (see also 3.5.1). - 5.1 Data accessibility—Statistics are presented in a clear and understandable manner, forms of dissemination are adequate, and statistics are made available on an impartial basis. - 5.1.1 Statistics are presented in a way that facilitates proper interpretation and meaningful comparisons (layout and clarity of text, tables, and charts). - 5.1.2 Dissemination media and format are adequate. - 5.1.3 Statistics are released on a preannounced schedule. - 5.1.4 Statistics are made available to all users at the same time. - 5.1.5 Statistics not routinely disseminated are made available upon request. - 5.2 Metadata accessibility—Up-to-date and pertinent metadata are made available. - 5.2.1 Documentation on concepts, scope, classifications, basis of recording, data sources, and statistical techniques is available, and differences from internationally accepted standards, guidelines, or good practices are annotated. - 5.2.2 Levels of detail are adapted to the needs of the intended audience. - 5.3 Assistance to users—Prompt and knowledgeable support service is available. - 5.3.1 Contact points for each subject field are publicized. - 5.3.2 Catalogs of publications, documents, and other services, including information on any charges, are widely available. ### Users’ survey — methodology and respondent breakdown - Questionnaires sent: 60. - Responses received: 24. - Respondent types (Total 24): - Government: 6 - State-owned agencies (enterprises): 2 - Banks: 3 - Other enterprises: 5 - Embassies/International organizations: 5 - Universities (researcher): 2 - Supervisory, regulatory institutions (stock exchange): 1 - Complementary engagement: general meeting with about a dozen users and three meetings with an individual user, organized by the CG. ### Users’ survey — key quantitative findings (selected) - Regular use of official statistics (percent of total respondents): - National accounts (NA): 88% - Prices: 92% - Government finance statistics (GFS) or fiscal data: 71% - Monetary and financial statistics (monetary): 67% - Balance of payments (BOP): 67% - Other: Production indices 50%; Labor market 50%; Merchandise trade 71%; International capital flows and foreign liquidity 25%; External debt (public and publicly guaranteed) 58%; International Investment Position 54% - Sources of official statistics (percent): - Controller General of the Republic of Panama: 100% - Superintendency of Banks of Panama: 54% - MEF: 63% - Other government agencies or departments: 25% - International and regional organizations: 38% - News media: 25% - Refer to descriptions of sources and methods: - Yes: 90% - No: 10% - Purposes of use (percent): - Analysis of current developments for short-term decision making: 38% - Analysis of trends for longer-term policy formulation: 50% - Econometric model building and forecasting: 63% - Economic research: 83% - Comparison with economic developments in other countries: 63% - General economic analysis: 79% - Market research: 50% - Coverage and detail (average across statistics): - Satisfied with coverage: 91% (Yes), 9% (No) - Satisfied with level of detail: 89% (Yes), 11% (No) - Data collection surveys adequate: 95% (Yes), 5% (No) - Statistical series consistent over time: 71% (Yes), 29% (No) - Periodicity and timeliness (average): - Satisfied with frequency: 79% (Yes), 21% (No) - Consider dissemination timeliness appropriate: 61% (Yes), 39% (No) - Dissemination practices (average): - Know if a public release calendar exists: 55% (Yes), 45% (No) - Official statistics released on announced dates: 60% (Yes), 40% (No) - Enough information about revisions: 89% (Yes), 11% (No) - Revision policy and procedure adequate: 86% (Yes), 14% (No) - Accessibility (average): - Can easily access official statistics: 91% (Yes), 9% (No) - Can easily access explanatory/methodological information: 84% (Yes), 16% (No) - Methodology sufficiently clear and detailed to be useful: Yes 78%, No 17%, No opinion 4% - Forms of access (selected percentages): - Hard copy official releases: 75% - Special requests (hard copy): 63% - E-mail: 83% - Electronic official releases: 79% - Official databases and other (CD-ROM): 29% - Presentation meets needs: 96% (Yes), 4% (No) - User support accessible, timely, competent: 92% (Yes), 8% (No) - Overall methodology sound and appropriate (average): - Yes: 90% - No: 10% - Consider official statistics reliable (average): - Yes: 81% - No: 19% - Compare quality with other countries in the region (average): - Better: 50% - Same: 46% - Worse: 4% - Overall quality rating (1 = poor; 5 = excellent): - Average: 4.0 (overall) - By domain: NA 4.0; CPI 4.1; WPI 4.2; GFS 3.8; MS 4.0; BOP 3.8 ### Users’ qualitative feedback (Box 1 — selected comments) - Consistency: Frequent methodological/base-year changes in national accounts impede long-term comparisons; lack of provincial-level data limits income-distribution analysis. - CPI concerns: Market basket and quality/consumer-taste changes not fully captured; specific issues with how housing/leasing changes are reflected. - Coverage gaps: Need for sub-accounts in services important to Panama (canal, ports, communications); estimates of global supply and demand lacking. - Access and dissemination: Requests for better timeliness (especially quarterly BOP and fiscal statistics), dissemination calendars and adherence, more dynamic web access (Excel, dynamic queries), and consolidated points of contact to avoid contacting multiple CG units. - Revisions: Concerns about frequency and magnitude of revisions and a need for a more transparent revisions policy. - User support and presentation: Desire for statistics to be easier to understand for the general public with explanatory notes; agencies credited with providing additional breakdowns and explanations on request. *Source: _cr06387 - 3.3 Statistical techniques—* --- _Source: https://www.imf.org/-/media/websites/imf/imported-full-text-pdf/external/pubs/ft/scr/2006/_cr06387.pdf_