## _wp1395

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### Definitions and classification
- Nonfinancial assets: defined by the System of National Accounts 2008 (2008 SNA) as "all economic assets other than financial assets, which do not represent claims on other units, but are stores of value and provide benefits either through their use in the production of goods and services or in the form of property income."
- Main divisions:
  - Produced assets: (i) fixed assets (building and structures, machinery and equipment, computer software, and, since 2008, research and development), (ii) inventories; and (iii) valuables (such as works of art, precious metals and stones).
  - Nonproduced assets: OECD groups these into tangible (such as land and subsoil resources) and nontangible (such as leases and licenses).
- Classification note: paper follows the format in line with the 1993 SNA and ESA95, since the OECD data are still presented in that format.

### Data sources, coverage, and comparability
- International data sources discussed:
  - OECD
  - Eurostat
  - IMF-Government Finance Statistics (GFS)
- Methodological systems:
  - OECD and Eurostat follow the 1993 SNA and ESA95.
  - IMF-GFS follows the GFS statistical reporting system.
- Coverage and reporting:
  - OECD reports data for at least one category of nonfinancial assets covering the general government of 22 economies.
  - For most countries OECD data are available from 1995; for a couple coverage begins in 1970.
  - Eurostat provides data for 20 EU countries, of which 18 are also covered by the OECD; Latvia and Lithuania are only included by Eurostat.
  - Analysis in the paper covers trends across 32 advanced and emerging economies.
- Cross-source differences: data can differ because different agencies produce the data and may have different coverage and methods; comparable cross-country data availability is limited.

### Key empirical observations and measurement gaps
- Composition and ownership:
  - Nonfinancial assets comprise mostly structures (such as roads and buildings) and land.
  - Nonfinancial assets are largely owned by subnational governments; subnational governments on average hold more than one-half of total nonfinancial assets.
  - In federal states (Canada, Germany, United States) subnational holdings exceed central government holdings by a ratio of at least four.
- Data gaps:
  - Few countries report values of land and subsoil assets; large data gaps persist.
  - Nonproduced assets data are frequently missing; sizable data available in only a small number of countries (e.g., Australia, France, Japan, Korea, Colombia, Netherlands).
  - Only 35 countries report any data on nonfinancial assets to OECD, Eurostat, and IMF GFS Database; only 16 show data on total nonfinancial assets.
  - Data start mostly in the late 1990s/early 2000s for many countries; some series cover only the central government.
- Reporting focus:
  - Countries report mostly produced assets; buildings and structures predominate within produced assets.
  - Nontangible fixed assets (usually computer software) available for about one-third of the sample.
  - The category “entertainment, literary or artistic originals” is quantified only by Australia, France, and Slovenia.

### Snapshot: levels and composition (key statistics)
- Average level of reported nonfinancial assets: 67 percent of GDP.
- Median level: 50 percent of GDP.
- Country extremes:
  - Over 120 percent of GDP: Czech Republic, Japan, Korea, Latvia.
  - Less than 25 percent of GDP: Bolivia, El Salvador, Hong Kong SAR, Switzerland.
- Produced assets: typically constitute more than 65 percent of total where both produced and nonproduced are reported, except Costa Rica (produced assets 2 percent of total) and Australia (produced assets 37 percent of total).
- Machinery and equipment: typically account for less than one-tenth of total assets in most economies.
- Nontangible fixed assets, valuables, and inventories: rarely exceed 1.5 percent of GDP, with exceptions:
  - Czech Republic: inventories 7.3 percent of GDP.
  - Latvia: inventories 2.9 percent of GDP.
  - Russia: inventories 5.0 percent of GDP.
- Land: largest component of nonproduced assets and particularly high in Australia, Costa Rica, France, Japan, and Korea.
- Subsoil assets: reported by Australia, Colombia, and the Netherlands and can be sizable.

### Trends in nonfinancial assets
- General trend: from the late 1990s most advanced and emerging economies, in particular the G-20, report rising nonfinancial assets relative to GDP.
- Mid-2000s: acceleration linked to housing, land, and commodity price booms; subsequent declines in the crisis were smaller than prior increases.
- Country-specific drivers:
  - Australia: rise driven by higher iron ore and coal prices (prices nearly quadrupled between 2004 and 2008) and higher land values.
  - France, Japan, Korea, United States: increase associated with higher property prices.
  - Netherlands: higher oil and property prices reflected in higher subsoil assets and buildings values.
- Exceptions: some advanced economies showed downward trends (Austria, Belgium, Canada, Finland, Germany) due to stable asset prices, lack of reported asset-price increases, and/or government divestment.
- Restitution and privatization produced sizeable declines in the Czech and Slovak Republics.

### Assets versus financial assets and debt
- Average nonfinancial-to-financial asset ratio: 1.2 to 1.3 (nonfinancial assets surpass financial assets on average by this ratio).
- Country ratios and shares:
  - Costa Rica: nonfinancial assets nearly 95 percent of total assets.
  - Czech Republic: ratio of 4:1 (nonfinancial to financial).
  - Australia, France, United States: ratio of 2:1.
- Total reported assets typically exceed or equal reported gross debt in most countries, including some high-debt countries (France, Germany, Japan, United Kingdom, United States).
- Caveat: asset valuations do not necessarily reflect the net present value of income streams; debt measures often exclude off-budget and contingent liabilities (e.g., future pension liabilities).

### Country case highlights (selected figures and policy notes)
- Australia
  - OECD vs GFS reported totals differ: GFS 69.6 percent of GDP; OECD 109.3 percent of GDP; difference −39.7 percentage points.
  - Subsoil assets tripled to about 45 percent of GDP over the past decade; land nearly doubled to about 21 percent of GDP. Together nearly two-thirds of total nonfinancial assets.
  - GFS/ OECD differences largely explained by coverage (about 85 percent) and valuation methodology (about 15 percent).
- Canada
  - Long time series available (data as early as 1970); valuations based on perpetual inventory model.
  - Key omission: subsoil assets not reported for general government. Statistics Canada estimate (economy-wide) for subsoil assets is about 70 percent of GDP (not sectorized to general government).
  - Reported general government nonfinancial assets around 45 percent of GDP; land reported at 10 percent of GDP.
- France
  - Comprehensive reporting since 1978; total nonfinancial assets increased by about 20 percentage points to 85 percent of GDP by 2010; land now about one-third of total assets.
  - Local governments account for three-quarters of nonfinancial asset ownership.
  - Receipts from sales of nonfinancial assets (2006–2011) shown in source; law mandated shares of proceeds to debt reduction increased from 15 percent historically to 20 percent in 2010, 25 percent in 2013, and 30 percent in 2014.
- Germany
  - Detailed fixed-asset data since 1991; no reported nonproduced assets.
  - General government fixed assets trended down to currently 43½ percent of GDP.
  - Local governments hold ≈60 percent of fixed assets; federal government and social security funds ≈22 percent; state governments ≈18 percent.
  - Majority of fixed assets are structures (roads and motorways 15½ percent of GDP); buildings and dwellings <3 percent of GDP.
  - Truck road toll yields about 0.2 percent of GDP in 2011.
- Italy
  - OECD data limited (dwellings only); national 2004 property census estimated total nonfinancial assets at 78 percent of GDP (central government 44.3, local governments 33.8, social security 0.5 percent of GDP).
  - 2004 census estimated “total disposable” assets 3.8 percent of GDP; earlier summary: almost 3.75 percent of GDP saleable in 2003 central government.
  - Preliminary 2011 census partial results and a study estimate total properties ~30 percent of GDP and land ~5 percent of GDP; disposable assets estimated ~3¼ percent of GDP (EUR50 billion) for unoccupied buildings.
- Japan
  - General government nonfinancial assets in 2010: 120 percent of GDP.
  - Increase of about 15 percentage points of GDP until the start of the Great Recession.
  - Land accounts for one-fifth of total nonfinancial assets; nonresidential buildings about 7½ percent of GDP; structures and buildings about 70 percent of total assets.
  - Almost 70 percent of nonfinancial assets owned by local governments.
  - IMF staff estimate potential saleable central government nonfinancial assets up to 7 percent of GDP over the long term.
  - Land leased to local governments ≈¥2,000 billion (about ½ percent of GDP).
- Korea
  - Comprehensive data since 1968; total nonfinancial assets 126 percent of GDP in 2011 (increase ≈26 percentage points since early 2000s).
  - Land and tangible fixed assets account for 95 percent of total government assets.
  - In 2011, two-thirds of government property reported in hands of central government (up from around one-half earlier).
  - Disposal sales cumulative 2004−11 ≈0.8 percent of GDP; proceeds reserved in Property Management Fund.
- United Kingdom
  - General government nonfinancial assets ≈50 percent of GDP in 2011; buildings and structures majority, more than one-half owned by local governments.
  - Public nonfinancial corporations reported another 13 percent of GDP (about one-half residential buildings).
  - Auction of 800 MHz and 2.6 GHz spectrum in Feb 2013 yielded about £2.3 billion (0.15 percent of GDP).
- United States
  - BEA general government nonfinancial assets ≈74 percent of GDP (BEA data).
  - OECD series start 1970; national BEA data broader and report general government nonfinancial assets ≈8–8½ percentage points above OECD data.
  - State and local governments account for ≈80 percent of general government nonfinancial assets (up from ≈50 percent in 1960).
  - Federal government fixed reproducible capital heavily skewed to defense: Department of Defense accounted for 64 percent of fixed reproducible capital at the federal level in 2011.
  - Disposal of federal assets limited (~½ percent of GDP cumulative over past two decades).

### Measurement, valuation, and accounting issues
- SNA principles:
  - Assets recorded only if economic assets (store of value, generate benefits).
  - Economic owner = unit exposed to risks and rewards (not necessarily legal title holder).
  - Nonfinancial assets subdivided into produced (fixed assets, inventories, intellectual property, valuables) and nonproduced (natural resources, contracts/leases/licenses, purchased goodwill).
  - Contracts, leases, and licenses treated as nonfinancial assets in SNA.
- Valuation methods and implications:
  - Historical cost: purchase price minus accumulated consumption of fixed capital; easy to maintain but downward biased over time and in inflationary contexts.
  - Market value: price a willing buyer/seller would agree; captures current market conditions but subject to volatility and may not exist for nonmarketable assets.
  - Replacement cost: current cost to construct same asset; useful where market prices are absent, less market volatile, resource intensive.
  - Perpetual inventory method (PIM): cumulates acquisition flows adjusted for price changes and consumption of fixed capital; widely accepted for structures but resource intensive; choice of consumption-of-fixed-capital method significantly affects results.
- Data sources differences:
  - National accounts (OECD reporting) generally rely on surveys and PIM.
  - GFS often relies on financial accounting and administrative sources.
  - Mixed-measure approaches (market value for some classes, replacement cost or historical cost for others) used by countries such as Canada and the United States impede comparability.
- Methodology changes can materially alter totals (example: Australian switch affecting valuation and consumption-of-fixed-capital method led to downward revision of 6½ percent of GDP in total nonfinancial assets).

### Policy implications and potential fiscal avenues
- Possible avenues for fiscal adjustment related to nonfinancial assets:
  - Disposal of nonfinancial assets.
  - Introduction of user fees (e.g., road tolls).
  - More effective asset management.
- Evidence to date:
  - Many countries have launched reforms to streamline public administrations, but receipts and savings have been rather small thus far.
- Net worth implication:
  - Government’s net worth would only increase if the assets being sold are more valuable when managed by the private sector than by being in public hands.
- More promising fiscal gains likely come from:
  - More efficient management of existing assets.
  - Greater use of user charges.
  - New financing arrangements, including public-private partnerships and leases.
  - Exploitation of subsoil assets where feasible.
- Priority: improving and expanding nonfinancial asset statistics to increase transparency and enable better asset management; only 35 countries report to international organizations and many report only subsets of asset types.

### Appendix — Selected country figures (from Appendix Table 1; values as presented)
- Australia (Latest available year 2010)
  - Nonfinancial assets: 109.3
  - Produced assets: 40.7
  - Fixed assets: 40.6
  - Tangible fixed assets: 38.6
  - Dwellings: 0.5
  - Other buildings and structures: 33.3
  - Machinery and equipment: 2.9
  - Intangible fixed assets: 2.0
  - Nonproduced assets: 68.6
  - Land: 21.9
  - Subsoil assets: 46.0
- Belgium (Latest available year 2011)
  - Nonfinancial assets: 37.6
  - Produced assets: 37.0
  - Fixed assets: 37.0
  - Tangible fixed assets: 36.8
  - Dwellings: 0.2
  - Other buildings and structures: 34.1
  - Machinery and equipment: 2.5
  - Intangible fixed assets: 0.3
  - Nonproduced assets: (not shown)
- Czech Republic (Latest available year 2011)
  - Nonfinancial assets: 161.3
  - Produced assets: 138.8
  - Fixed assets: 131.7
  - Tangible fixed assets: 131.4
  - Dwellings: 22.6
  - Other buildings and structures: 122.0
  - Machinery and equipment: 3.7
  - Nonproduced assets: 22.5
  - Land: 19.7
  - Subsoil assets: 0.0
- Finland (Latest available year 2011)
  - Nonfinancial assets: 47.7
  - Produced assets: 47.7
  - Fixed assets: 47.7
  - Tangible fixed assets: 47.5
  - Dwellings: 0.6
  - Other buildings and structures: 44.2
  - Machinery and equipment: 2.7
  - Intangible fixed assets: 0.2
  - Nonproduced assets: (not shown)
- France (Latest available year 2011)
  - Nonfinancial assets: 88.3
  - Produced assets: 54.4
  - Fixed assets: 53.5
  - Tangible fixed assets: 53.1
  - Dwellings: 2.9
  - Other buildings and structures: 48.9
  - Machinery and equipment: 1.3
  - Intangible fixed assets: 0.4
  - Nonproduced assets: 33.9
  - Land: 33.8
  - Subsoil assets: 0.1
- Germany (Latest available year 2011)
  - Nonfinancial assets: 43.4
  - Produced assets: 43.4
  - Fixed assets: 43.4
  - Tangible fixed assets: 43.3
  - Dwellings: 1.3
  - Other buildings and structures: 40.7
  - Machinery and equipment: 1.3
  - Intangible fixed assets: 0.2
  - Nonproduced assets: (not shown)
- Japan (Latest available year 2010)
  - Nonfinancial assets: 120.2
  - Fixed assets: 93.9
  - Tangible fixed assets: 94.2
  - Dwellings: 91.4
  - Machinery and equipment: 2.2
  - Intangible fixed assets: 0.6
  - Nonproduced assets: 26.0
  - Land: 26.0
  - Subsoil assets: 4.9
- Korea (Latest available year 2010)
  - Nonfinancial assets: 127.9
  - Produced assets: 57.1
  - Tangible fixed assets: 56.5
  - Other buildings and structures: 160.4
  - Intangible fixed assets: 0.4
  - Nonproduced assets: 69.3
  - Land: 63.3
  - Subsoil assets: 4.9
  - Noncultivated bio and water resources: 1.0
- United Kingdom (Latest available year 2011)
  - Nonfinancial assets: 49.2
  - Produced assets: 49.2
  - Fixed assets: 49.2
  - Dwellings: 18.6
  - Other buildings and structures: 46.4
  - Machinery and equipment: 1.1
  - Intangible fixed assets: 0.0
  - Nonproduced assets: 3.3
  - Land: 3.3
- United States (Latest available year 2011)
  - Nonfinancial assets: 66.3
  - Produced assets: 66.3
  - Fixed assets: 66.3
  - Tangible fixed assets: 65.8
  - Dwellings: 0.6
  - Other buildings and structures: 60.7
  - Machinery and equipment: 2.9
  - Intangible fixed assets: 0.5
  - Nonproduced assets: (not shown)

_Italic: Source: _wp1395 — IMF working paper content (excerpt)._

### 1. OECD Data Coverage of Nonfinancial Assets ......................................................................7

### 1. OECD Data Coverage of Nonfinancial Assets

### Definitions and classification
- Nonfinancial assets are defined by the System of National Accounts 2008 (2008 SNA) as "all economic assets other than financial assets, which do not represent claims on other units, but are stores of value and provide benefits either through their use in the production of goods and services or in the form of property income."
- Nonfinancial assets are generally divided into:
  - Produced assets: (i) fixed assets (building and structures, machinery and equipment, computer software, and, since 2008, research and development), (ii) inventories; and (iii) valuables (such as works of art, precious metals and stones).
  - Nonproduced assets: OECD groups these into tangible (such as land and subsoil resources) and nontangible (such as leases and licenses).
- Note on classifications: the 2008 SNA splits nonproduced assets into three categories (natural resources; contracts, leases, and licenses; and purchased goodwill and marketing assets). This paper follows the classification presented in Figure 1, in line with the 1993 SNA and ESA95, since the OECD data are still presented in that format.

### Data sources, coverage, and comparability
- International data sources for nonfinancial assets discussed:
  - OECD
  - Eurostat
  - IMF-Government Finance Statistics (GFS)
- Methodological systems in use:
  - OECD and Eurostat follow the 1993 SNA and the European System of Accounts 1995 (ESA95).
  - IMF-GFS follows the GFS statistical reporting system.
- Although the statistical definitions are conceptually harmonized, data can differ in practice because different agencies produce the data and may have different coverage and methods.
- OECD reporting:
  - The OECD reports data for at least one category of nonfinancial assets covering the general government of 22 economies.
  - For most countries data are available from 1995, while for a couple, coverage begins in 1970.
- Eurostat reporting:
  - Eurostat provides data for 20 countries of the European Union, of which 18 are also covered by the OECD.
  - Latvia and Lithuania are only included by Eurostat.
- The analysis in the paper covers trends across 32 advanced and emerging economies.

### Key empirical observations (from the paper)
- Nonfinancial assets comprise mostly structures (such as roads and buildings) and land.
- Their values have increased over time mostly due to higher property and commodity prices.
- Nonfinancial assets are largely owned by subnational governments.
- Few countries report values of land and subsoil assets; large data gaps persist.
- Because governments tend to hold nonfinancial assets for use, they tend to consider relatively small sets of assets to be disposable.
- Important considerations when contemplating disposal:
  - Market availability and the nature of the asset (e.g., environmental sustainability, military/security use, cultural and national heritage).
  - Timing to avoid fire sales and depressing asset prices.
  - Potential future revenue losses if the asset generates income.
  - Potential higher spending (for example, if government buildings are sold and space must be leased).
  - Effects on intergenerational equity.
- Possible avenues for fiscal adjustment related to nonfinancial assets:
  - Disposal of nonfinancial assets.
  - Introduction of user fees (e.g., road tolls).
  - More effective asset management.
- Evidence to date:
  - Many countries have launched reforms to streamline public administrations, but receipts and savings have been rather small thus far.
- Net worth implication:
  - The government’s net worth would only increase if the assets being sold are more valuable when managed by the private sector than by being in public hands.

### Implications for measurement and analysis
- Comparable cross-country data availability is limited.
- Differences in agency responsibility, coverage, and methods impede full comparability across sources (OECD, Eurostat, IMF-GFS).
- Recent and gradual extension of reporting for the general government improves the ability to analyze public-sector nonfinancial assets, but substantial gaps remain (notably land and subsoil valuations).

_Italic: Source: _wp1395 - 1. OECD Data Coverage of Nonfinancial Assets (excerpt) from the IMF working paper PDF provided._

### Section IV.

### _wp1395 - Section IV.

### Data coverage, gaps, and comparability
- 35 countries report any data on nonfinancial assets to OECD, Eurostat, and the IMF GFS Database; only 16 show data on total nonfinancial assets.
- Data start mostly in the late 1990s/early 2000s for many countries; some series cover only the central government.
- Countries report mostly produced assets; within produced assets, buildings and structures predominate. Nontangible fixed assets (usually computer software) are available for about one-third of the sample.
- The category “entertainment, literary or artistic originals” is quantified only by Australia, France, and Slovenia.
- Nonproduced assets data are frequently missing: available and sizable in only a small number of countries (e.g., Australia, France, Japan, Korea, Colombia, Netherlands).
- Cross-country comparisons require caution because of differences in coverage and valuation methods; different source data (national accounts vs GFS) can generate large divergences.

### Snapshot: Levels and composition of nonfinancial assets
- Average level of reported nonfinancial assets: 67 percent of GDP.
- Median level: 50 percent of GDP.
- Examples of country extremes:
  - Over 120 percent of GDP: Czech Republic, Japan, Korea, Latvia.
  - Less than 25 percent of GDP: Bolivia, El Salvador, Hong Kong SAR, Switzerland.
- Produced assets typically constitute more than 65 percent of total where both produced and nonproduced are reported, except Costa Rica (produced assets 2 percent of total) and Australia (produced assets 37 percent of total).
- Machinery and equipment typically account for less than one-tenth of total assets in most economies.
- Nontangible fixed assets, valuables, and inventories rarely exceed 1.5 percent of GDP, with exceptions:
  - Czech Republic: inventories 7.3 percent of GDP.
  - Latvia: inventories 2.9 percent of GDP.
  - Russia: inventories 5.0 percent of GDP.
- Land is the largest component of nonproduced assets and is particularly high in Australia, Costa Rica, France, Japan, and Korea.
- Subsoil assets are reported by Australia, Colombia, and the Netherlands and can be sizable.
- Subnational governments on average hold more than one-half of total nonfinancial assets; in federal states (Canada, Germany, United States) subnational holdings exceed central government holdings by a ratio of at least four.

### Trends in nonfinancial assets
- From the late 1990s most advanced and emerging economies, in particular the G-20, report rising nonfinancial assets relative to GDP.
- Mid-2000s acceleration linked to housing, land, and commodity price booms; subsequent declines in the crisis were smaller than prior increases.
- Country-specific drivers:
  - Australia: rise driven by higher iron ore and coal prices (prices nearly quadrupled between 2004 and 2008) and higher land values.
  - France, Japan, Korea, United States: increase associated with higher property prices.
  - Netherlands: higher oil and property prices reflected in higher subsoil assets and buildings values.
- Some advanced economies showed downward trends in nonfinancial assets (Austria, Belgium, Canada, Finland, Germany) due to stable asset prices, lack of reported asset-price increases, and/or government divestment.
- Restitution and privatization led to sizeable declines in the Czech and Slovak Republics.

### Assets versus financial assets and debt
- Nonfinancial assets surpass financial assets on average by a ratio of 1.2 to 1.3.
- Highest nonfinancial-to-financial ratios:
  - Costa Rica: nonfinancial assets nearly 95 percent of total assets.
  - Czech Republic: ratio of 4:1.
  - Australia, France, United States: ratio of 2:1.
- Total reported assets typically exceed or equal reported gross debt in most countries, including some high-debt countries (France, Germany, Japan, United Kingdom, United States).
- Caveat: asset valuations do not necessarily reflect the net present value of income streams and debt measures often exclude off-budget and contingent liabilities (e.g., future pension liabilities).

### Country case highlights (key figures and policy notes)
- Australia
  - OECD vs GFS reported totals differ: GFS 69.6 percent of GDP; OECD 109.3 percent of GDP; difference −39.7 percentage points.
  - GFS/ OECD differences largely explained by coverage (about 85 percent) and valuation methodology (about 15 percent).
  - Subsoil assets valued using net present value of expected future income flows; subsoil assets tripled to about 45 percent of GDP over the past decade; land nearly doubled to about 21 percent of GDP. Together nearly two-thirds of total nonfinancial assets.
  - No major divestment program in recent fiscal strategy; debate about divesting some infrastructure to fund new construction.
- Canada
  - Long time series available (data as early as 1970); valuations based on perpetual inventory model.
  - Key omission: subsoil assets are not reported for general government. Statistics Canada estimate (economy-wide) for subsoil assets is about 70 percent of GDP (not sectorized to general government).
  - Reported general government nonfinancial assets around 45 percent of GDP; land reported at 10 percent of GDP.
- France
  - Comprehensive reporting since 1978; most subcategories reported and changes separated into valuation and volume effects.
  - Total nonfinancial assets increased by about 20 percentage points to 85 percent of GDP by 2010; land now about one-third of total assets.
  - Local governments account for three-quarters of nonfinancial asset ownership.
  - Receipts from sales of nonfinancial assets (2006–2011): total receipts shown in the source (e.g., Receipts from NFA sales totaled 3,612.9 million euros in the last reported column); amount earmarked for debt reduction historically small (e.g., percent of receipts from NFA ranged around 4.8–15.7 percent in the years listed); law mandated 15 percent of proceeds from sales contribute to debt reduction (increased to 20 percent in 2010, 25 percent in 2013, and 30 percent in 2014).
- Germany
  - Detailed fixed-asset data available since 1991; no reported nonproduced assets.
  - General government fixed assets trended down to currently 43½ percent of GDP.
  - Local governments hold ≈60 percent of fixed assets; federal government and social security funds ≈22 percent; state governments ≈18 percent.
  - Majority of fixed assets are structures (roads and motorways 15½ percent of GDP); buildings and dwellings <3 percent of GDP.
  - Strategy emphasizes efficient management and user charges (e.g., truck road toll yields about 0.2 percent of GDP in 2011).
- Italy
  - OECD data limited (dwellings only); national 2004 property census estimated total nonfinancial assets at 78 percent of GDP (central government 44.3, local governments 33.8, social security 0.5 percent of GDP).
  - 2004 census estimated “total disposable” assets 3.8 percent of GDP; earlier summary: almost 3.75 percent of GDP saleable in 2003 central government.
  - Preliminary 2011 census partial results and a study estimate total properties ~30 percent of GDP and land ~5 percent of GDP; disposable assets estimated ~3¼ percent of GDP (EUR50 billion) for unoccupied buildings.
  - New agency (SGR) and laws set modalities to use receipts from asset sales for debt reduction; measures under discussion include sale of management rights, TV licenses, CO2 emission rights, government shares, and tax credits.
- Japan
  - General government nonfinancial assets in 2010: 120 percent of GDP.
  - Increase of about 15 percentage points of GDP until the start of the Great Recession.
  - Land accounts for one-fifth of total nonfinancial assets; nonresidential buildings about 7½ percent of GDP; structures and buildings about 70 percent of total assets.
  - Almost 70 percent of nonfinancial assets owned by local governments.
  - IMF staff estimate potential saleable central government nonfinancial assets up to 7 percent of GDP over the long term, though practical short-term saleability limited.
  - Ongoing reform to improve tracking, recording, and disposal: loans, leasing, and sell-offs considered; land leased to local governments ≈¥2,000 billion (about ½ percent of GDP).
- Korea
  - Comprehensive data since 1968; total nonfinancial assets 126 percent of GDP in 2011 (increase ≈26 percentage points since early 2000s).
  - Land and tangible fixed assets account for 95 percent of total government assets.
  - In 2011, two-thirds of government property reported in hands of central government (up from around one-half earlier).
  - Disposal sales cumulative 2004−11 ≈0.8 percent of GDP; proceeds reserved in Property Management Fund for property management and development projects.
- United Kingdom
  - Detailed datasets for produced assets only; Whole of Government Accounts (first published Nov 2011 for 2009–10) include public sector nonfinancial assets under IFRS.
  - General government nonfinancial assets ≈50 percent of GDP in 2011; buildings and structures are majority, more than one-half owned by local governments.
  - Public nonfinancial corporations reported another 13 percent of GDP (about one-half residential buildings).
  - Recent receipts example: auction of 800 MHz and 2.6 GHz spectrum in Feb 2013 yielded about £2.3 billion (0.15 percent of GDP).
- United States
  - Long time series available (national accounts from 1960; OECD starts 1970); national BEA data broader than OECD and report general government nonfinancial assets ≈8–8½ percentage points above OECD data (difference larger in earlier decades).
  - BEA general government nonfinancial assets ≈74 percent of GDP (BEA data).
  - State and local governments account for ≈80 percent of general government nonfinancial assets (up from ≈50 percent in 1960).
  - Federal government fixed reproducible capital heavily skewed to defense: Department of Defense accounted for 64 percent of fixed reproducible capital at the federal level in 2011 (per OMB).
  - Disposal of federal assets limited (~½ percent of GDP cumulative over past two decades); “Campaign to Cut Waste” aimed to cut administrative costs and dispose of unneeded real property (targeted savings modest relative to federal debt).

### Measurement, valuation, and accounting issues
- Definitions and principles (2008 SNA):
  - Assets recorded only if economic assets (store of value, generate benefits).
  - Economic owner = unit exposed to risks and rewards; not necessarily legal title holder.
  - Nonfinancial assets subdivided into produced (fixed assets, inventories, intellectual property, valuables) and nonproduced (natural resources, contracts/leases/licenses, purchased goodwill).
  - Contracts, leases, and licenses treated as nonfinancial assets in SNA (e.g., taxi license is asset of holder but not a liability of issuing government).
- Valuation methods produce materially different outcomes:
  - Historical cost: purchase price minus accumulated consumption of fixed capital; easy to maintain but downward biased over time and in inflationary contexts.
  - Market value: price a willing buyer/seller would agree; captures current market conditions but subject to volatility and may not exist for nonmarketable assets.
  - Replacement cost: current cost to construct same asset; useful where market prices are absent, less market volatile, resource intensive.
- Perpetual inventory method (PIM): cumulates acquisition flows adjusted for price changes and consumption of fixed capital; widely accepted for structures but resource intensive; choice of consumption-of-fixed-capital method (straight line, useful life, geometric, parabolic) significantly affects results.
- Data sources differ:
  - National accounts (OECD reporting) generally rely on surveys and PIM.
  - GFS often relies on financial accounting and administrative sources.
  - Mixed-measure approaches (market value for some classes, replacement cost or historical cost for others) used by countries such as Canada and the United States impede comparability.
- Changes in methodology can materially alter reported totals (example: Australian switch affecting valuation and consumption-of-fixed-capital method led to downward revision of 6½ percent of GDP in total nonfinancial assets).

### Conclusions and policy implications
- Reported nonfinancial assets vary widely (averaging 67 percent of GDP) and are dominated by structures; when reported, land and subsoil assets can be very large.
- Nonfinancial assets have generally increased over the past decade in many advanced economies, driven by commodity, land, and property price rises; the Great Recession only partly reversed earlier gains.
- Subnational governments hold a large share of nonfinancial assets in many countries; this has implications for asset management and fiscal strategies at different government levels.
- Reported nonfinancial assets typically exceed financial assets and, combined, assets are higher than gross debt in most countries; however, asset values do not directly translate into resources available to service debt, and liabilities like pensions are often excluded.
- Potential saleable nonfinancial assets are usually limited (examples: Italy ≈4 percent of GDP estimated saleable; Japan up to 7 percent of GDP by IMF staff estimates; Italy newer estimates ~3¼ percent of GDP saleable in unoccupied buildings).
- Rather than large-scale disposals, more promising fiscal gains may come from:
  - More efficient management of existing assets.
  - Greater use of user charges (e.g., road tolls).
  - New financing arrangements, including public-private partnerships and leases.
  - Exploitation of subsoil assets where feasible.
- Improving and expanding nonfinancial asset statistics is a priority to increase transparency and enable better asset management:
  - Only 35 countries report to international organizations; many report only subsets of asset types.
  - Greater consistency in coverage and valuation methodology between national accounts and GFS (and international reporting) would improve comparability and policy relevance.

*Source: _wp1395 - Section IV.*

### References

### References and Appendix Table 1 — Nonfinancial Assets: Country-Specific Details

### References
- Dippelsman, R., C. Dziobek, C. A. Gutiérrez Margas (2012), “What Lies Beneath: The Statistical Definition of Public Sector Debt. An Overview of the Coverage of Public Sector Debt for 61 Countries,” IMF Staff Discussion Note, May 2012.
- European Commission, International Monetary Fund, Organisation for Economic Co-operation and Development, United Nations, World Bank, System of National Accounts 1993.
- European Commission, International Monetary Fund, Organisation for Economic Co-operation and Development, United Nations, World Bank, System of National Accounts 2008.
- International Monetary Fund (2001), Government Finance Statistics Manual, second edition (http://www.imf.org/external/pubs/ft/gfs/manual/pdf/all.pdf) (Washington).
- International Monetary Fund (2004), Government Finance Statistics Data, Companion Materials, and Research (http://www.imf.org/external/pubs/ft/gfs/manual/comp.htm) (Washington).
- International Monetary Fund (2011a), Public Sector Debt Statistics: Guide for Compilers and Users, (http://www.tffs.org/PSDStoc.htm) (Washington).
- International Monetary Fund (2011b), “The Importance of Monitoring Both Gross and Net Debt,” in: IMF Fiscal Monitor September 2011, Appendix 3 (Washington).
- International Monetary Fund (2012), Government Finance Statistics Yearbook (Washington).
- Mameli, P. (2012), “Italia: “Quanto si può Attingere dal Patrimonio Pubblico?,” in Intesa San Paolo, Weekly Economic Monitor, 20 April 2012.
- Marini, M. (2011), “Compilation of Annual Balance Sheets for Nonfinancial Assets: Methodological Approach, Main Outcomes and Open Issues in the Italian Experience,” paper presented at the IMF and OECD Conference on Strengthening Sectoral Position and Flow Data in the Macroeconomic Accounts.
- Ministry of Finance, Japan (2011), What do we Know about National Property?, Ministry of Finance.
- Ministry of Finance, Japan (2012), The Japanese National Property System and Current Conditions, National Property Information System, Financial Bureau, Ministry of Finance, March 2012.
- Ondrus (2011), Compilation of Non-financial Balances in the Czech Republic, Conference on Strengthening Sectoral Position and Flow Data in the Macroeconomic Accounts, Jointly organized by the IMF and OECD, February 28–March 2, 2011.
- Organisation for Economic Co-operation and Development (2011), “Measuring Capital, OECD Manual: Measurement of Capital Stocks, Consumption of Fixed Capital and Capital Services” (Paris).
- Rawdanowicz, L., E. Wurzel, P. Ollivaud (2011), “Current Issues in Managing Government Debt and Assets”, OECD Economics Department Working Papers n. 923.
- Wasshausen, D. (2011), “Sectoral Balance Sheets for Nonfinancial Assets,” Bureau of Economic Analysis, February 2011.

### Appendix Table 1 — Nonfinancial Assets (country excerpts and key figures)
- Australia (Latest available year 2010)
  - Nonfinancial assets: 109.3
  - Produced assets: 40.7
  - Fixed assets: 40.6
  - Tangible fixed assets: 38.6
  - Dwellings: 0.5
  - Other buildings and structures: 33.3
  - Machinery and equipment: 2.9
  - Intangible fixed assets: 2.0
  - Nonproduced assets: 68.6
  - Land: 21.9
  - Subsoil assets: 46.0

- Belgium (Latest available year 2011)
  - Nonfinancial assets: 37.6
  - Produced assets: 37.0
  - Fixed assets: 37.0
  - Tangible fixed assets: 36.8
  - Dwellings: 0.2
  - Other buildings and structures: 34.1
  - Machinery and equipment: 2.5
  - Intangible fixed assets: 0.3
  - Nonproduced assets: (not shown)

- Czech Republic (Latest available year 2011)
  - Nonfinancial assets: 161.3
  - Produced assets: 138.8
  - Fixed assets: 131.7
  - Tangible fixed assets: 131.4
  - Dwellings: 22.6
  - Other buildings and structures: 122.0
  - Machinery and equipment: 3.7
  - Nonproduced assets: 22.5
  - Land: 19.7
  - Subsoil assets: 0.0

- Finland (Latest available year 2011)
  - Nonfinancial assets: 47.7
  - Produced assets: 47.7
  - Fixed assets: 47.7
  - Tangible fixed assets: 47.5
  - Dwellings: 0.6
  - Other buildings and structures: 44.2
  - Machinery and equipment: 2.7
  - Intangible fixed assets: 0.2
  - Nonproduced assets: (not shown)

- France (Latest available year 2011)
  - Nonfinancial assets: 88.3
  - Produced assets: 54.4
  - Fixed assets: 53.5
  - Tangible fixed assets: 53.1
  - Dwellings: 2.9
  - Other buildings and structures: 48.9
  - Machinery and equipment: 1.3
  - Intangible fixed assets: 0.4
  - Nonproduced assets: 33.9
  - Land: 33.8
  - Subsoil assets: 0.1

- Germany (Latest available year 2011)
  - Nonfinancial assets: 43.4
  - Produced assets: 43.4
  - Fixed assets: 43.4
  - Tangible fixed assets: 43.3
  - Dwellings: 1.3
  - Other buildings and structures: 40.7
  - Machinery and equipment: 1.3
  - Intangible fixed assets: 0.2
  - Nonproduced assets: (not shown)

- Japan (Latest available year 2010)
  - Nonfinancial assets: 120.2
  - Produced assets: (not shown)
  - Fixed assets: 93.9
  - Tangible fixed assets: 94.2
  - Dwellings: 91.4
  - Other buildings and structures: (not shown)
  - Machinery and equipment: 2.2
  - Intangible fixed assets: 0.6
  - Nonproduced assets: 26.0
  - Land: 26.0
  - Subsoil assets: 4.9

- Korea (Latest available year 2010)
  - Nonfinancial assets: 127.9
  - Produced assets: 57.1
  - Fixed assets: (not shown for some items)
  - Tangible fixed assets: 56.5
  - Dwellings: (not shown)
  - Other buildings and structures: 160.4
  - Machinery and equipment: (not shown)
  - Intangible fixed assets: 0.4
  - Nonproduced assets: 69.3
  - Land: 63.3
  - Subsoil assets: 4.9
  - Noncultivated bio and water resources: 1.0

- United Kingdom (Latest available year 2011)
  - Nonfinancial assets: 49.2
  - Produced assets: 49.2
  - Fixed assets: 49.2
  - Tangible fixed assets: 49.2 (implied)
  - Dwellings: 18.6
  - Other buildings and structures: 46.4
  - Machinery and equipment: 1.1
  - Intangible fixed assets: 0.0
  - Nonproduced assets: 3.3
  - Land: 3.3
  - Subsoil assets: (not shown)

- United States (Latest available year 2011)
  - Nonfinancial assets: 66.3
  - Produced assets: 66.3
  - Fixed assets: 66.3
  - Tangible fixed assets: 65.8
  - Dwellings: 0.6
  - Other buildings and structures: 60.7
  - Machinery and equipment: 2.9
  - Intangible fixed assets: 0.5
  - Nonproduced assets: (not shown)

Notes on table content and sources:
- Table presents country-specific detail lines including "Latest available year", "Nonfinancial assets", "Produced assets", "Fixed assets", "Tangible fixed assets", "Dwellings", "Other buildings and structures", "Machinery and equipment", "Intangible fixed assets", "Inventories", "Valuables", "Nonproduced assets", "Tangible non-produced assets", "Land", "Subsoil assets", "Noncultivated bio and water resources", "Intangible nonproduced assets", and "Sources".
- Sources cited in table cells include "OECD", "OECD/Eu r o s t a t", "GFS", and "National source" as shown per country rows.
- Ellipses ("...") in the table indicate cells where values are not shown in the extracted content.

*Italic: Content unit: _wp1395 - References; Source PDF filename: _wp1395 - References*

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