TWINNING CONTRACT

Institutional Capacity Building for the Central Agency for Public Mobilisation and Statistics (CAPMAS) and Developing the Legal Framework for Statistics in Egypt

EG/07/AA/F106

MISSION REPORT

on

Workshop on improving quality of economic indicators

Component No 7/5.1.11

Mission carried out by Jaroslav Sixta, Czech Statistical Office and Marek Rojicek, Czech Statistical Office

Cairo, 25 th – 29 th October 2009

Central Agency for Public Mobilisation and Statistics

PHARE 2005

Author’s name, address, e-mail:

Jaroslav Sixta Czech Statistical Office Na padesatem 81 100 82 10 Tel. +420 27405 4253 [email protected]

Marek Rojicek Czech Statistical Office Na padesatem 81 100 82 Prague 10 Czech Republic Tel. +420 27405 2486 [email protected]

Table of contents

Executive Summary ...... 4 1. General comments...... 5 2. Assessment and results...... 5 3. Conclusions and recommendations...... 7 Annex 1. Terms of Reference ...... 7 Annex 2. List of participants:...... 10

List of Abbreviations

BC Beneficiary Country BOP Balance of Payments CAPMAS Central Agency for Public Mobilisation and Statistics ESA 95 European System of Accounts 1995 EU GDP Gross Domestic Product IMF International Monetary Fund IT Information Technology MOED Ministry of Economic Development MEDSTAT EU Statistical Co-operation with Mediterranean Countries MOA Ministry of Agriculture MOF Ministry of Finance MS Member States NA National Accounts NOE Non Observed Economy QNA Quarterly National Accounts ROSC Report on Observance of Standards and Codes SDDS Special Data Dissemination Standard SNA 93 System of National Accounts 1993 SUT Supply and Use Tables TOR Terms of Reference USAID United States Agency for International Development Executive Summary

This mission was aimed on discussion on economic indicators. The main work of experts on the mission was the presentation and discussion about current situation concerning compilation and dissemination of economic indicators in the Czech Republic and Egypt.

MS Experts and Egyptian colleges together came to several conclusions and gave recommendations particularly in improvement of economic indicators.

1. General comments

This mission report was prepared within the Egyptian-Danish Twinning Project „Institutional capacity building for the central agency for public mobilisation and statistics”. This twinning project is EG/07/AA/F106.

The concrete objectives of the mission were: - Improve the production of economic indicators

MS experts followed up the previous missions conclusions in the context of economic indicators with special regard to national accounts. During the mission experts obtained good overview of system of economic indicators compiled by CAPMAS and Ministry of Economic Development and discussed the differences in the methodology and dissemination policy in both countries.

The consultants would like to express their thanks to all officials and individuals met for the kind support and valuable information which they received during the stay in Egypt, and which highly facilitated the work of the consultants.

2. Assessment and results

Table 1: Mission time schedule Date Subject Participants Sunday Meeting with RTA and component leader and the see the list of participants in 25. 10. 09 relevant staff within CAPMAS and MoED the Annex 2., Determining the agenda for the mission Peter Ottosen General discussion of the purpose and definition of economic indicators. Presentation of the system of economic statistics in the Czech Republic.

Monday Presentation of the production and dissemination of see the list of participants in 26. 10. 09 economic indicators in the Czech Republic. the Annex 2., Presentation of interdependencies between national accounts and business statistics (agriculture, industry, construction, trade, transport and other market service).

Tuesday Presentation of needs, requests and accessibility of see the list of participants in 27. 10. 09 economic indicators to the users in the Czech Rep. the Annex 2., The production of economic indicators in Egypt (CAPMAS, Ministry of Economic Development) Wednesday Egyptian experts presented the overview of see the list of participants in 28. 10. 09 economic indicators in different industries. the Annex 2.,

Thursday Final discussions and clarifications jointly with see the list of participants in 29. 10. 09 CAPMAS and National accounts the Annex 2., Presentation of preliminary results and findings

Discussion proceeded in the following parts:

a.) Main short-term economic indicators;

CAPMAS and MoED are compiling wide range of economic indicators, both in the area of business statistics and national accounts. The users have sufficient amount of indicators for various purposes; the indicators are published relatively in time, especially short term indicators (monthly index of production and quarterly GDP estimate in t+45 days). The first estimate of GDP is based mostly on estimation of the economic subjects and next quarter the figures are revised.

For individual activities data are available in monthly, quarterly and annual period. Monthly the data on number of tourist and nights spend are available.

Quarterly industrial (manufacturing, electricity, oil industry) indicators (number of employees, production, intermediate consumption, wages and salaries, etc.) are published. Data are published 180 days after the reference period.

b.) Structural data

Presented publication of the Annual national accounts included sector accounts (by institutional sectors and also by activities), sources and uses of GDP and it provides to the users wide range of information. The publication is available 15 months after the reference period. There is a plan to reduce the delay to t + 12 months. Sector accounts are compiled up to non-financial asset account; the last balancing item is therefore net lending/borrowing.

The annual publication on agriculture, construction, trade and health were discussed. These publications covered the most important data needed for national accounts. Some financial data are compiled on the basis of business accounting data (balance sheets, income and loss statements). Some indicators are also published in regional breakdown. All figures are in current prices.

c.) Quality of data

Quality of economic indicators is dependent on the quality of source data. Establishment of the NA unit within CAPMAS should lead to the improvement of the quality of NA indicators. The quality of NA indicators nonetheless depends significantly also on the strict following of the methodology of national accounts based recently on the SNA 93 standard. It needs sufficient number of qualified and experienced staff at the NA department – in this context the current situation at MoED (15 experts) seems to be insufficient.

3. Conclusions and recommendations

1. Economic indicators are accessible to the users but further promotion of electronic form of publication would be useful. A visible progress in this context is a web page of the MoED and CAPMAS. 2. Some of adjustments are currently done, but the system of adjustment of surveyed data ensuring full harmonisation with national accountings standards (SNA 93) would be improved. These adjustments would comprise differences between national and business accountings rules. The given recommendations in previous missions should be followed. 3. Regional accounts represent a very important part of statistics; the CAPMAS should focus on this issue. 4. Deflation of NA indicators should be done within the supply and use framework. 5. Environmental indicators should be published, as well. 6. Consumption of fixed capital in government sector should be estimated in more sophisticated way, perpetual inventory method should be preferred. 7. Sector accounts should be split into sub-sectors in compliance with SNA 1993. 8. Full accumulation account covering nominal holding gains, other changes in volume and financial account should be compiled and published. 9. The CAPMAS, the MoED and the Ministry of Tourism are going to prepare tourist satellite account, it is important to finish it. 10. The CAPMAS should consider reducing the delay in publishing quarterly data, t+70 days would be recommended. 11. Some estimates for the non-surveyed population of private doctors and clinics (financial data) should be done. 12. Shot-term indicators for different services (e.g. education) should be developed (e,g. revenues, wages). 13. The CAPMAS should build up a business register that allows regular sample surveys and grossing up to the total population. The project on unifying identification number of company in different databases is currently in process. This is an important step to business register. 14. The number of NA staff seems insufficient; the CAPMAS and the MoED should consider increasing the number of NA experts. The CAPMAS’s new NA unit needs more training and support. 15. The CAPMAS should focus more on quality of source data.

Annex 1. Terms of Reference for a short-term mission to the Central Agency for Mobilisation and Statistics On

Activity 5.1.11 Workshop on economic indicators Background CAPMAS and Statistics Denmark with partners have established a fruitful cooperation in the framework of Twinning. This twinning project is EG/07/AA/F106.

This activity is part of component 5, Development of certain statistical areas in the subcomponent dealing with the Development of National Accounts. The objective for this component is development of National Accounts.

This activity will contribute to this objective and especially to the benchmark set out in the contract: By the 15 th month, an action plan to improve the production of economic indicators developed and new methodology is drafted Purpose of the mission The mission is a workshop where the MS and BC experts will work jointly on the topic of developing economic indicators. The MS and BC experts will develop new methodology to be used in practical applications. Expected Results • Recommendations on improving the production of economic indicators Activities A tentative schedule for the mission is:

Sunday 25 October 2009 Introduction to CAPMAS and overall discussion on the activity with the RTA Meeting with component leader and the relevant staff within CAPMAS Determining the agenda for the mission General discussion of the purpose and definition of economic indicators Presentation of the system of economic statistics in the Czech Republic.

Monday 26 October 2009 Presentation of the production and dissemination of economic indicators in the Czech Republic Presentation of interdependencies between national accounts and business statistics (agriculture, industry, construction, trade, transport and other market services).

Tuesday 27 October 2009 Presentation of needs, requests and accessibility of economic indicators to the users in the Czech Republic. The production of economic indicators in Egypt (CAPMAS, Ministry of Economic Development, etc.)

Wednesday 28 October 2009 The needs, uses and requests for economic indicators in private and public institutions in Egypt

Thursday 29 October 2009 Final discussions and clarifications jointly with CAPMAS and National accounts Presentation of preliminary results and findings Tasks to be done by CAPMAS to facilitate the mission The beneficiary will arrange meetings with the relevant staff in CAPMAS. Consultant and counterpart The mission will be carried out jointly by:

Mr. Marek Rojicek, Czech Statistical Office And Mr. Jaroslav Sixta, Czech Statistical Office

The beneficiary’s counterpart will be:

Ms. Awatef Emam Abougendy And Ms. Amani Khalil Timing The mission will be carried out during 25- 29 October 2009 in Cairo. Report A final report from the mission should be made available not later than two weeks after the termination of the mission. Annex 2. List of participants: Activity 5.1.11 Workshop on Economic Indicators 25-29 Oct. Participants from Inside CAPMAS

Name Title

Head of Central Department for General 1 Ms. Awatef Emam Statistics 2 Ms. Fayza Emam Senior Specialist

3 Ms. Amani Adel Khalil Senior Specialist

4 Mr. Abdel Karem Ahmed Senior Specialist

5 Mr. Ahmed Fathy Ahmed Third Specialist

6 Ms. Seham Yusuf First Specialist

7 Ms. Nabila El Nagger Senior Specialist

8 Ms. Naglaa Hassan Third Specialist

9 Mr. Mostafa Mohamed Senior Specialist

10 Mr. Mohamed Farid Statistical Sector 11 Mr. Amal Abdel Zaher Head of Section 12 Ms. Rasha Mohamed Program Planner 13 Ms. Laila Youssef General Manager 14 Mr. Ahmed Mohamed Health Services 15 Mr. Fayik Amin Head of Energy Section 16 Ms. Hoda Abd El Elal Senior Specialist 17 Ms. Mary Twfik Senior Specialist 18 Ms. Nahid Zaky Hotel and Tourism Section 19 Ms. Aziza Fouad Senior Specialist 20 Ms. Magda Hassan Head of Construction section 21 Ms. Mona Aub First Specialist 22 Ms. Eman Abbas Second Specialist 23 Ms. Magda Mahmoud Programe Planner 24 Ms. Zeinab Mohammed El Araby Third Statistician

Participants from outside CAPMAS

Name Title Side

1 Mr. Qutb Salem U.N Advisor UN

2 Mr. Kamal El Araby U.N Advisor UN

3 Ms. Wafa Aly Senior Specialist MoDE

4 Mr. Idris Mohamed Senior Specialist MoDE

Czech Experts

1 Mr. Jaroslav Sixta Czech Statistical Office Head of Input-Output Section Director of Macroeconomic Statistics 2 Mr. Marek Rojicek Czech Statistical Office Branch