Thailand - Nominal Fixed Investment (gross fixed capital formation)

National accounts or national income accounts show economic flows among economic units at the macro level. These flows include production of goods and services which in turn leads to income payable to factors of that production, disposition of that income, saving and investment of economic institutions. This also includes economic activities dealing with the rest of the world, especially export and import of goods and services.

Moreover, the national accounts as the whole system will also include investment in financial and intangible assets and capital stocks including changes in stocks caused by various factors.

Quarterly Gross Domestic Product on the expenditure side (QGDE) is compiled by using the concept and methodology recommended in the United National System of National Accounts (UNSNA). Calculation on the expenditure side measures only the expenses on the final goods and services. Estimation Methods of QGDE at current prices include (1) Quarterly Private Consumption Expenditure, (2) Quarterly Government Consumption Expenditure, (3) Quarterly Gross Fixed Capital Formation, (4) Quarterly exports and imports are estimated by the direct method using quarterly data from the Bank of Thailand and (5) Calculation of Change in Inventories.

The formula is:

QGDE = C + I + G + (X-M) + D Stock

Where C = Private Consumption Expenditure

I = Gross Fixed Capital Formation

G = Government Consumption Expenditure

X-M = Net Export of Goods and Services when

X = Export of Goods and Services, M = Import of Goods and Services.

Classification

Quarterly Gross Domestic Product by the expenditure side has been estimated from the first quarter of 1993 to the second quarter of 1998 and will be carried out further to the current quarter. Previously, the classification of Quarterly Gross Domestic Product using fixed weighted volume measures by the expenditure side follows the Central Product Classification (CPC). After updating the compilation to Chain Volume Measures, the classification on the expenditure side is updated to Classification of Individual Consumption According to Purpose (COICOP). COICOP can be compared and linked to CPC and the CPC can be compared and linked to the International Standard Industrial Classification (ISIC) used in QGDP estimated by the production side and also to the Harmonized System used in imports and exports classification.

The sources where data is collected from are:

• Manufacturing production and Sale data from the office of Industrial Economics.
• Quarterly Socio-Economic Survey data (SES) from National Statistical Office
• Actual Government Expenditure of Ministries, Departments, Central Governments, Local Governments and Non-Profit Institutions from the Comptroller-General's Department, Bangkok Metropolitan Administration and Others.
• Value Added Tax data from Revenue Department
• Economic situations from various organizations

Estimation of QGDE in real terms

• The quarterly Private Consumption Expenditure is deflated by related Consumer Price Index.
• The quarterly Government Consumption Expenditure is deflated by related Consumer Price Index and Salary index.
• Quarterly Gross Fixed Capital Formation is deflated by related Wholesale Price Index (WPI).

Thailand quarterly GDP comes in three stages:

• First presentation: This is to illustrate the result of GDP compilation based on indicators and professional judgments. The first presentation is quite important because it reveals economic situations in the previous quarter in a timely manner and also provides the right direction of change in the economy.
• Second presentation or first revision: This is a backward adjustment from the current quarter and adjustments need to take into account these issues; (1)adjustments form data source, (2) new and better indicators available, (3) only core items should be revised,(4) how significant are adjustments from primary data and (5) how important such items are in national accounts
• Second revision: GDP estimated by the indirect method is usually different from the annual figure even with good indicators. When the annual figures, which are estimated by the direct method, hence more accurate, have been released, the quarterly figures are adjusted so the sum of GDP from four quarters is equal to the annual value . GDP which have been adjusted after the second revision can be used as the benchmark for estimating following quarters. The second revision can be utilized as many times as the backward change happened to the annual figures.

GDP is also reported in seasonal adjustment figures which reflect the real changes in production and expenditure in each quarter as the seasonal effects are got rid of.

The source of the metadata: http://www.nesdb.go.th/nesdb_en/ewt_news.php?nid=4324&filename=index