IMPLEMENTATION OF STATISTICAL CLASSIFICATION IN MONGOLIA

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1 UNITED NATIONS DEPARTMENT OF ECONOMIC AND SOCIAL AFFAIRS STATISTICS DIVISION UN WORKSHOP ON INTERNATIONAL ECONOMIC AND SOCIAL CLASSIFICATIONS BANGKOK, THAILAND NOVEMBER, 2008 IMPLEMENTATION OF STATISTICAL CLASSIFICATION IN MONGOLIA Name of participant: Ms. Oyunbileg Delgersaikhan Senior Statistician Macro Economic Statistics National Statistical Office Name of the country: Mongolia 1

2 UN WORKSHOP ON INTERNATIONAL ECONOMIC AND SOCIAL CLASSIFICATIONS NOVEMBER, 2008, BANGKOK, THAILAND. IMPLEMENTATION OF STATISTICAL CLASSIFICATION IN MONGOLIA Introduction The traditions of the Mongolian statistical system date back centuries ago and historical sources and references indicate that our ancient ancestors Hunnus used to count their herds by marking the records using cut woods. Later in the 13th century, having established a mighty State, the Mongols used to count their population, based on which the Government imposed taxes. The 1921 people s revolution marked a new development era in Mongolia s accounting and statistics history, creating conducive environment and conditions for the development of economic surveys and counts, especially the development of scientific statistics. The first Mongolian Constitution adopted in 1924 laid the foundation of the modern statistics by legalizing any state counting and surveying activities and the resolution of the country s first Ikh Khural, the Parliament, provided for commencing counting and surveying activities by establishing a unit for any counting and surveying as the process bears much importance. Thus, on November 11, 1924 the Data Counting Division was first formed under the Ministry of Internal Affairs, with a staff of six, setting the basis for development of statistics office in Mongolia. In 1990 the State Statistical Office was re-established as the State Statistical Office. This was the time when Mongolia had just shifted to democracy and market economy, with a nascent parliamentary government, allowing for multiple forms of property ownership. Mongolia faced new challenges to replace the then existing statistical data collection method based general observations with the method of specified surveys and other modern means as well as introducing internationally accepted practices and principles. 2

3 Structure of the National Statistics System According to provision 2 of Article 11, Chapter 4, of the Mongolian Law on Statistics the structure of the statistical organization in Mongolia comprises an independent, centralized national statistics office with divisions and local statistics departments and units under the supervision of the Governors of provinces, sub-provinces and the capital city and its districts. Statistical activities are managed at sub-provincial level by deputy governors or administration staffers, and at bag or khoroo level (the smallest administrative level inferior to sub-provinces) by their governors. Figure 1. Structure of the Mongolian Statistical System The NSO reports to and is supervised by the State Ikh Khural, the national Parliament. The NSO is responsible for ensuring that the statistical information and data by the Government, its ministries and agencies do not overlap and duplicate with the official statistics, ensures the integrity of methodological support, approves and endorses indicators, methodologies and procedures, and evaluates the coverage and accuracy of statistical information. There have passed 15 years since the United Nations approved the fundamental principles of official statistics. Mongolia follows and applies these principles in its development and adoption of legislations and methods regarding official statistical activities. The NSO has carried out censuses such as Population and Housing Census (2000) and Census of Business Entities (1991, 1994, 1998, 2006), with the support of such international organizations as the UNFPA, UNICEF, World Bank, and Asian Development Bank. The surveys conducted with the suppoort of these organizations include Living 3

4 Standards Measurement Survey (1995, 1998, 2002, 2003), Children and Development survey (1996, 2000, ), Reproductive Health Survey (1998, 2003), Time Management Survey (2000), Labour Force and Child Labor Survey ( , 2006), The Survey on Disabled, Workers in Business Entities Survey, Participatory Living Standards Measurement Survey (2000, 2005) and other sample surveys. Results of these censuses and surveys have been made public. These activities have greatly helped enhance and streamline statistical methodology, improve scientific bases, conduct analyses on statistical information and data using statistics methods, forecast future perspectives, expand the scope of censuses, researches, and surveys, and expant the outreach of resulting information and data. Current structure and organization of the NSO aim at serving toward successful implementation of the Program for Development of Official Statistics ( ) as well as to exercising and carrying out the NSO powers, rights and duties under the Law of Mongolia on Statistics and other pertinent laws and regulatory statutes of Mongolia. With directions approved by the Chairman of the NSO, the Head Office conducts its activities with 6 departments being the Macroeconomic Statistics, Public Administration and Management, Demographic and Social Statistics, Research, Monitoring, Evaluation and Marketing, Data Processing and Technology and one independent Economic Statistics Division, Foreign Relations Division, Population and Housing Census Bureau. National Council of NSO Chairman of NSO Board of Chairman of NSO Standing Council of Policy Planning and Coordination Senior Vice- Chairman of NSO Vice-Chairman of NSO Standing Council of Methodology and Research General Manager Public Administration and Management Macroeconomic Statistics Demographic and Social Statistics Research Monitoring, Evaluation and Marketing Data Processing and Technology Foreign Relations Division Economic Statistics Division Population and Housing Census Bureau 4

5 Classifications used in Mongolia 1. International Standard Industrial Classification (ISIC) Mongolia used ISIC Rev.3 for its 1998 Establishment Census for the first time. According to a joint Decree by Mongolian National Statistical Office Chairman and Finance and Economic Minister of Mongolia, the ISIC was updated by its Rev.3.1 in Under the updated version, industrial statistics are produced at ISIC 4, 3, and 2 digit levels. The Ministry of Finance of Mongolia, the Ministry of Trade and Industry, and other relevant ministries and their subsidiary agencies implement the ISIC. As for our office, translating ISIC Rev.4, we have sent the translated version to 13 line ministries and agencies, such as the Ministry of Finance, the Ministry of Construction and Urban Development, the Ministry of Education, Culture and Science, the Ministry of Roads, Transportation, and Tourism, the Bank of Mongolia, the Information Communication Technology Agency, the Ministry of Social Welfare and Labour, the Ministry of Trade and Industry, Mongolian Tax Administration, the Ministry of Fuel and Energy, the Ministry of Food and Agriculture, the Ministry of Health, and the Mongolian National Chamber of Commerce and Industry for their comment. In addition, the ISIC Rev.4 has been used in conjunction with the ISIC Rev.3.1 on an experimental basis. So far, there have not been any difficulties with the exercise. Comments on the ISIC Rev.4 1. the period of the introduction of the ISIC is crucial; 2. need to be consistent with classifications of products. To this end, the following issues should be taken into consideration: a. although gold mining is included in the mining sector in the ISIC, it is regarded as manufacturing sector in the CPC; 5

6 b. include the activity of inter-city transportation in Urban and suburban passenger land transport of H Section Transportation and Storage. If it is not included in the class, indicate in which class should it be incorporated; c. add the activity of tourism transportation to 4922 Other passenger land transport; d. consider general and auxiliary activities of road and tourism sectors that are not in the draft; e. detail the leasing such as leasing and operational leasing () (see 77 division) f. include the following activities in 6492 Other credit granting: (i) consumer loan granting; (ii) financing foreign trade; (iii) provision of long term financing by industrial banks for industrial sector; (iv) credit granting (apart from bank sector); (v) mortgage loan granting by specialized organizations that do not desposit; and (vi) pawn-broking service. g. incorporate the following activities into the draft: (i) development of project proposals; (ii) investment activities; (iii) car washing; (iv) carting; (v) engraving and wrap-up services for souvenir items; (vi) planting and selling of decorative and indoor plants/flowers; (vii) watch repair; (viii) car washing; (ix) electric and gas welding; and (x) selling and repairing of eyeglasses. 6

7 2. Central Product Classification (CPC) In Mongolia, the Central Product Classification have been used since Before applying this classification, it is customized to fit some specific characteristics of sectors in Mongolia and now the classification at 6 digit level has been used in main sectors such as industry, agriculture, construction, and trade. As classifying products of industry and agriculture sectors, as well as of input and output table, according to the central product classification, sometimes a problem has been faced to classify domestic products that made in Mongolia. Moreover, it is started that CPC Rev.2 version has been tested in Mongolia. Some opinions on the CPC Rev.2 version: 1. Products and services of electricity have been classified in different divisions. Those are supposed to classify in same division. For instance: h. Division 17. Electricity, town gas, steam and hot water i. Division 42. Group Steam generators, (except central heating boilers) and parts thereof j. Division 43. Group Engines and turbines and parts thereof 2. Leather gloves should be added in Class Wallet should be added in Subclass Special boots for workers in worse situation should be added in Group Furniture, sofa, and seats covered by original leather in Group The name of Group 389 should be changed as Other products 7. The name of Subclass should be changed as Machinery for preparing, tanning or working hides, skins or leather or for making or repairing footwear or other articles of hides, skins or leather, other than sewing machines 8. Services for inspection and certification of all types of services and products should be added in Section 9. 7