A. National Accounts Estimates (Annual and Quarterly)

B. Price Statistics (Consumer Price Index and Producer Price Index)

0. Prerequisites of Quality

0.1 Legal and institutional environment

Chile’s price statistics are compiled and disseminated by the National Statistical Institute (Instituto Nacional de Estadísticas, INE). The legal authority and responsibility for the compilation and dissemination of price statistics is directly specified. Law Decree 313 of 1960 approved the creation of the former Directorate of Statistics and Census (Dirección de Estadísticas y Censos). This mandate was superseded by Law 17.734 de 1970, and its Regulations, which created INE, the National Statistical Commission (Comisión Nacional de Estadísticas, CNS), and the Consultative Technical Committee (Comité Consultivo Técnico de Estadísticas, CTC). Wherein it is established that the INE is the administratively decentralized technical agency responsible for official statistics and censuses in Chile. According to Article 2 of Law No 17.374, the INE must collect, process and publish the official statistics, as well as submit to the President of the Republic on a yearly basis the Annual Statistical Plan. Article 5 of Law No 17.374, creates the National Statistical Commission (Comisión Nacional de Estadísticas, CNS), adjunct to the Director of INE. The CNS has, among its attributions, the approval of the Annual Statistical Plan prior to its submission to the President. This Plan guides the production of statistics and proposes statistical studies and improvements in compilation and dissemination of official statistics.

The Annual Statistical Plan is prepared by INE’s Director with the cooperation of the CTC and the prior approval of the CNS. Both the CTC and the CNS are composed of representatives from the BCCH and MOF as well as other SEN branches, and are presided by INE’s Director.

All individuals and legal entities are required to provide any information requested by the INE, which in turn is required to maintain strict confidentiality and is prohibited from explicitly referring directly or indirectly in its publications to individuals or legal entities.

INE’s questionnaires inform data providers about the provisions of this law.

The CNS is composed of representatives from the National Planning Commission, the Development Corporation, BCCH, MOF, and from the universities, one labor representative and one from the corporate sector.¹⁹

The CTC coordinates the collection, classification and dissemination of the statistics prepared by the public sector institutions (fiscal, mixed ownership and public enterprises) with the corresponding tasks of INE. In particular, CTC must reach agreements on principles, norms and directives that must be applied in the statistical field in order to perform the coordination in its mandate. The CTC is composed of representatives from the public sector, the universities, as well as specific international regional organizations such as the Economic Commission for Latin America (CEPAL).

The INE and the other branches of the Chilean Statistical System (SEN) cannot disseminate facts that refer to individuals or particular entities when they have been obtained in the course of carrying out its statistical functions. The strict observance of this obligation constitutes the “Statistical Secrecy” principle. Failing to observe this principle by anyone subject to this obligation is penalized under article 247° of the Penal Code. In addition, Article 30° of the Law states that no statistical data with specific direct or indirect reference to a person or entity can be published or disseminated if there is a prohibition from those affected.

0.2 Resources

Overall, the INE has adequate resources to carry out its mandate. The area where the authorities would want additional resources is in hiring outside experts.

The price statistics program has adequate staff resources. However, due to the low level of wages and the “law of immobilization”, which precludes free hiring and firing of employees, the INE has difficulties in appointing and retaining qualified staff. The law applies to approximately 70 percent of the 700 staff. The remaining staff is under contract, which allows some limited flexibility in the pay scale.

The price statistics program has adequate financial resources. In general, INE has no difficulties in financing the Annual Statistical Plan, which is routinely approved. Special projects are also financed but require strong justification.

The price statistics program has adequate computing resources, being supported by a modern computerized system based on Windows NT. Other statistics programs, notably the remuneration statistics, have an antiquated computer system although it is in the process of being upgraded.

0.3 Quality awareness

The INE is proud and vocal about being very quality conscious. It is carrying out a project on a “Diagnostic Survey to Determine the Quality of INE’s Statistical Products”. The survey will be for internal use and aims to determine areas where there is need for improvement. The first phase is of fact-finding, the second for implementing the recommendations, and the third is for following up changes implemented to improve and ensure the quality of INE’s statistics. The project began in 2000 and is scheduled to run for six years through 2006.

The CNS, which comprises data users and data providers, gives advice on policy and priorities in the Annual Statistical Program.

Concepts, methodologies, and accounting conventions used within the INE are in harmony with the International Labor Organization (ILO) for the CPI, and the SNA 1968/1993 standards and recommendations for the PPI. The latter is a hybrid of the two standards above: the 1993 SNA applies only to industry currently and will in the future be applied first to agriculture, followed by fishing, mining and remaining sectors as the project advances.

1. Integrity

Data gathering and dissemination are carried out using objective mechanisms and appropriate calculation algorithms are used for compilation of statistics.

1.1 Professionalism

According to the Law that established the INE, the Institute is independent in determining the methodology, release dates, design of surveys and definitions used. Data gathering is objective and impartial. The sources and methods used are determined by sound statistical methodologies (probabilistic sampling).

The INE is entitled to issue clarifications on the indicators disseminated and in fact is often called to explain movements in the CPI -- the most sensitive indicator-- to members of Congress or the press. However, the INE also feels that, given the transparency of their methods and soundness of their procedures, there is scant justification for errors of interpretation or inadequate use of the statistical products they disseminate.

1.2 Transparency

Terms and conditions

The terms and conditions under which the data are produced and disseminated are available to the public.

No government officials outside the INE have access to the data before their release to the public. In general, ministerial commentary is not attached to the release of the data. At times, however, the Minister of Economy and/or the Minister of Finance may hold press conferences at the time the data are released. On occasion, the Director of the INE may also hold a press conference to hand out the “Indicadores del Mes - Precios y Remuneraciones” (Monthly Indicators - Prices and Remunerations) and to comment on the data.

The data on the CPI and PPI are final when first released and are not subject to revisions.

Major changes in methodology, including a new base period, take place approximately every ten years and are announced to the public in advance in great detail although in some cases they are not.

Advance release calendars are publicized and disseminated.

The data are released simultaneously to all interested parties.

Documentation on methodology

Documentation on the methodology of price statistics is disseminated. For the CPI, the INE’s document “Indice de Precios al Consumidor, IPC, base: December 1998 = 100, Aspectos Metodológicos” (Consumer Price Index, base: December 1998 = 100, Methodological Issues) provides a detailed description of the methodology, including the theoretical bases, and description of all the components of the index, and their respective weights. This document may be requested from the INE’s Marketing Unit and is also available on the Internet INE website (http://www.ine.cl/).²⁰

For the PPI, INE’s document “Indice de Precios al por Mayor: Base June 1992 = 100, Metodología” (Wholesale Price Index: Base June 1992 = 100, Methodology) provides a detailed description of the methodology, including the theoretical bases, identification, and description of the components of the index and their respective weights. This document may be requested from the INE’s Marketing Unit.

1.3 Ethical standards

Ethical guidelines for INE officials are contained in the Regulatory Decree 1.062 (Reglamento del INE) of October 30,1970, Titles II through VI. Title V, on employees’ obligations and prohibitions, details instances of specifically forbidden activities. Title VI, on employees’ responsibilities, spells out the consequences of failing to meet duties and responsibilities. The Administrative Statute that applies to civil servants complements the INE’s guidelines. The Statute was issued as Law N° 18.834 of September 23, 1989. Title III on general rules specifically deals with ethical guidelines in the form of specific obligations and prohibitions for civil servants. Title V on administrative responsibility deals with the steps that would be taken if infringement to the responsibility took place.

2. Methodological Soundness

2.1 Concepts and definitions

CPI

Concepts and definitions used for the compilation of the CPI in Chile correspond to international practices and are in line with the recommendations of the ILO on this subject. The CPI measures the changes in price of a representative basket of goods and services purchased by households; prices are actual market prices paid by consumers.

PPI

The official name of the index in Chile is “indices de precios al por mayor”, that is wholesale price index (WPI). As the name suggests, the index is not a pure PPI designed to measure changes in prices charged by local producers of goods. Instead, the index actually measures the changes in price of a fixed basket representative of locally produced and imported goods. Weights for the compilation of the WPI are based on the concepts and definitions of the supply and use table of goods and services according to the recommendations contained in the 1968 SNA and the 1993 SNA. For locally produced goods, the price concept used is the producer’s ex-factory prices in the case of manufacture and mining products, but wholesale prices are used for agriculture and fishing products. C.i.f. prices are used for imported goods.

2.2 Scope

CPI

The CPI measures the change in prices of a fixed basket of goods and services representative of the final consumption expenditures of households of the Greater Santiago. All goods and services purchased by households for consumption purposes, as defined in the national accounts, are included.

PPI

The WPI covers all market output (excludes only the production of goods to be used as intermediate consumption by the same establishment) of goods produced by the manufacturing, mining, agriculture and fishing industries and sold in the domestic market (exports are excluded). Similarly, the WPI covers all imported goods that have the same industrial origin as mentioned above.

2.3 Classification/sectorization

CPI

The CPI is not based on an international classification. However, there is a one to one correspondence between the CPI’s classification and that of COICOP. Products are classified into 41 minor groups and 8 mayor groups (food, housing, housing equipment, clothing, transportation, health, education and recreation, and miscellaneous goods and services). The index basket includes 483 products for which there are 1195 varieties (specifications) in total.

PPI

The classification of establishments and economic activities is in accordance with a local adaptation of the International Standard Industrial Classification of all Economic Activities (ISIC Rev.2). Products were classified by industries of origin mainly based on the ISIC Rev 2. The index is compiled separately for imported and locally produced goods according to the economic use of the goods (inputs to production, final consumption and capital formation).

2.4 Basis for recording

CPI

The valuation rules for weights and for price collection are in accordance with the SNA concept for the valuation of final consumption expenditure. Prices collected are the actual market prices paid by households (after discounts and rebates), including all taxes levied on the products. Financial charges are excluded.

PPI

Prices collected for locally produced goods are market prices at which transactions take place. These prices correspond in general to the concept of producer’s prices (except for agriculture products for which most prices collected are the wholesale level. Prices of imported goods are collected on a c.i.f. basis. The valuation rules for weighing purposes are the producer’s prices for each economic destination of the goods. Detailed and narrow specifications of items are used for the collection of prices, which represent the net prices received by producers or paid by importers for their more characteristic type of transaction.

3. Accuracy and reliability

3.1 Source data

CPI

The selection of the basket and the weights of the CPI are based on the Family Budget Survey of 1996/1997. The reference period of this survey was August 1996-July 1997. All socio-economic stratums of the population were covered within the geographical area of the Greater Santiago. The survey was based on a random sampling design by which 8,445 households were selected to constitute the survey sample. The survey was conducted through all the reference period. Weights are infrequently changed with a periodicity of about 10 years, which correspond to the frequency at which the Family Budget Surveys (FBS) have been conducted. The previous update was made in 1988.

Prices are collected monthly from 2489 outlets and service providers. Besides, about 200 housing units are surveyed every month to collect data on rents. Approximately 130,000 price quotations are obtained every month by means of enumerator’s visits to the selected outlets and service providers.

PPI

The WPI basket and weights are updated at infrequent periods of time. The commodity composition and weights of the present WPI are based on the supply and use table of 1986, compiled within the framework of the national accounts. Detailed breakdown by commodity of the use matrices of domestically produced goods and of imports, both at producer prices, was used to determine the weights of the products within the industry of origin and for the index aggregates. Products were selected for each economic use according to their relative importance within each industry (those which represent 1.9% or more) at the four level of the ISIC classification.

The primary selection of informant enterprises was based, in the case of manufacture, on a cut- off sample including the enterprises for which sales of the products selected represented 90% of total sales in the annual industrial survey for the year 1987, and latter updates based on the annual industrial survey of 1989. A similar process for the selection of enterprises was applied to imports, based on detailed data on imports by commodity and importer for the year 1989. The criteria for selecting enterprises in the mining industry were, in general, the enterprise size. Different sources are used to collect prices of the agriculture products.

Prices are collected monthly by mail from 685 establishments using a specific questionnaire. An exception is 36 agriculture and food products for which average weekly prices are collected. There are 1265 price quotations for 378 products. Prices collected relate to the same day of the month (or as close as possible) in each period.

3.2 Statistical techniques

CPI

The FBS provides with sufficiently detailed data on household consumption to derive the weights of the CPI. Products were selected in accordance to their relative share in total consumption, and all products having a share equal or greater than 0.025% were selected with the only exception of car rentals, video cameras and dishwashers, which were found to be consumed almost exclusively by only 1% of the population with the highest income.

Very narrow specifications of products (the variety) are used for the collection of representative prices for each product selected. Outlets were selected based on the most important places of purchases by household in term of volume.

The base period of the index is December 1998. Weights from the 1997/1998 FBS were updated to December 1998 using the changes in prices of the specific products. The Laspeyres formula with the base period weights is used to calculate the index at the upper levels of aggregation. The variety index is calculated as the geometrical mean of the month-to-month price ratios of all observations. At the product level, a month to previous month index is calculated as a weighted geometrical mean of the indices of varieties included. Product indices with respect to the base period are aggregated to upper levels using the classic Laspeyres formula with weights of the base period. An exception is the food items, which are aggregated up to the article level using weighted geometrical means.

Imputation of missing prices is made using observed price changes of other varieties in the same group. Replacement items are introduced using the overlap method. New products are only introduced at the time of updating the weight of the CPI.

PPI

Detailed data on output and imports by products are available for the compilation of the supply and use table for national accounts benchmark years, like in 1986, which is the source for weights used in the WPI. Comprehensive surveys and censuses, using sound statistical techniques, were used for the 1986 national accounts benchmark year estimates. All goods covered in the scope of the index are included. The PPI is compiled using a Laspeyres formula with weights of 1986. The reference period of the index is June 1992. Base period weights were not adjusted to the reference period by price changes. The index is calculated at the lowest level of aggregation using average prices ratios of current period to reference period (June 1992) for each individual item. At all level of aggregation, the Laspeyres formula with the 1986 weights is used.

The index is not updated for the inclusion of new products. Replacements of items that become permanently unavailable are made using the overlap method. Missing prices are imputed by carrying forward the last observation available.

3.3 Assessment and validation

There are various validation procedures for the source data. However, these procedures do not cover all areas (sampling and non-sampling errors).

In those cases were information exists to allow validations of intermediate data, the validation is carried out comparing both results and determining the factors causing the differences found. Statistical discrepancies are investigated and notified to the users.

CPI

Sampling and non- sampling errors for the FBS are available. Prices collected are verified according to established procedures for checking price quotations. Manual and automatic checks are performed at different stages of the CPI compilation.

PPI

Comprehensive enterprise surveys were carried out for the base year, generally with a census approach for large firms and random samples for the small units. The comprehensiveness of the output and import data used for determining the weights of the WPI are enhanced by the supply and use table framework from which they were derived.

The source data on prices is constantly reviewed by the compilers for the sake of temporal consistency and doubts are resolved by means of direct inquires with the informants. The staff manually verifies the index calculation at various stages of compilation.

3.4. Revision studies

Not applicable since both indices are not revised and become final when first released.

4. Serviceability

4.1 Relevance

Although no surveys have been conducted to objectively assess whether the price statistics program meets user needs, the users of the price statistics have generally indicated that the data adequately respond to their needs.

4.2 Timeliness and periodicity

The periodicity of both the PPI and the CPI is monthly.

The timeliness of the monthly PPI and CPI is 5 working days.

4.3 Consistency

Temporal consistency

Consistent time series of the PPI and CPI at the aggregate level are compiled based on consistency criteria that are adjusted each time the base year is changed (approximately every 10 years).

“Indicadores Mensuales” (Monthly Indicators) publishes indices and annual changes in the overall CPI and in its main components for the last eight years, as well as indices and monthly changes for the last two years. Moreover, additional breakdowns are published in the “Indicadores Mensuales” and on the Internet (under “Indice de Precios”). “Series de Precios al Consumidor” provides average monthly prices for 483 CPI items for the last two months.

“Indicadores Mensuales” publishes indices and annual changes in the overall PPI and its components for the last seven years, and monthly changes for the last two years. Series of average bimonthly prices for the 414 items in the index for the last two months and percentage changes are published in “Series de Precios al por Mayor”.

Internal consistency

The PPI and CPI are internally consistent by construction/methodology of calculation.

Intersectoral consistency

There are no procedures in place to reconcile price data with that of other sources or frameworks. However, INE staff indicated that they are conscious of the need for consistency with other sectors and frameworks.

4.4 Revision policy and practice

The PPI and CPI data are released according to a regular, well established, and transparent schedule. The release schedule is, in particular, predetermined and stable from year to year, and announced in advance of expected release dates.

The release dates are coordinated with the arrival of the price data sources.

There is no revision policy for the CPI and PPI data, since they are final when first released and are not revised. Nevertheless, great care is taken in the compilation of the CPI because these data are used in financial transactions, rent contracts, labor contracts and the like.

5. Accessibility

5.1 Data accessibility

The PPI and CPI data are disseminated regularly in detail and with time-series, according to a well-established production and release schedule, through a dedicated monthly publication, and through electronic means. Data presentation are appropriate, easy to interpret and known to the users. Nonconfidential, more detailed data than that disseminated are available from the INE upon request.

5.2 Metadata accessibility

Comprehensive descriptions of PPI and CPI metadata are published in the INE publications, and are available on the DSBB and the INE website (http://www.ine.cl/). However, the metadata does not include a comparison or detailed assessment of Chilean practices vis-à-vis internationally accepted norms.

5.3 Assistance to users

A contact person for PPI and CPI is available to provide further assistance as required. The name, telephone number and e-mail address of contact persons are indicated in the publications, the INE website (http//:www.ine.cl) and the DSBB.

C. Government Finance Statistics

0. Prerequisites of Quality

0.1 Legal and institutional environment

0.1.1 The responsibility for compiling and disseminating GFS is clearly assigned to one agency

In Chile the government finance statistics (GFS) are compiled and published under the terms and conditions of the Annual Budget Law, Decree-Law No. 1263 of 1975, and Decree with Legal Power-106 of 1960.

The Annual Budget Law requires that the Budget Directorate (Dirección de Presupuestos, DIPRES) of the Ministry of Finance (MOF) send data to Congress on the quarterly budget execution of the central government revenue and expenditure, within 60 days after the end of the quarter (45 days beginning in 2001).

Decree Law No. 1263 states that the DIPRES must issue during December of every year the specific budgetary instructions applicable for the following year. These include the data to be reported to the DIPRES concerning monthly budget execution. The law also states that all central government units must prepare by December 31 of every year a statement of revenues and expenditures, and a statement of financial position, and send these to the DIPRES and the Comptroller’s General Office (Contraloria General de la República, CGR). Finally, the law states that the CGR must prepare annually consolidated statements on the public sector’s budgetary position, financial position, and equity position.

Decree with Legal Power-106 states in article 22 (modified by Law on November 1999) that the functions of the DIPRES include, among other, the compilation of GFS and their dissemination to Congress and the general public, as well as to international organizations.

0.1.2 Data sharing and coordination among data producing agencies are adequate.

The information published under financial accountability arrangements (e.g., publicly available data on budget outcomes) has similar scope as GFS, and can be reconciled to GFS. The data prepared by the DIPRES are compiled in accordance with the methodology recommended by the IMF’s “A Manual on Government Finance Statistics, 1986” (1986 GFS Manual). In addition, a reasonable degree of consistency can be established between the data published by the DIPRES and the data published by the CGR.

There are no formal arrangements for cooperation between the agency responsible for compiling GFS financing data and the agency responsible for compiling financial data for other sectors, or between the agency responsible for compiling GFS and the agency responsible for compiling national accounts data, or between the agency responsible for compiling GFS debt data and the agency responsible for compiling external debt data. However, there are informal arrangements between the DIPRES, the BCCH and the INE. Furthermore, the government data used for compiling national accounts is currently provided by the CGR, not the DIPRES. There are on-going conversations for the DIPRES to begin providing such data to the BCCH.

There are no formal mechanisms in place to maintain close liaison between GFS compilers and important users of the statistics. However, there is a close relationship with Congress.

0.1.3 Access to records

There is adequate access to the data required to compile GFS

All central government units must provide the DIPRES all data required for compilation of GFS, within a given time frame. Local government units -municipalities- provide information to the CGR, which in turn provides it to the DIPRES. Finally, there are only informal arrangements for receiving debt data.

The CGR is the entity responsible for establishing the accounting standards for the public sector; it is also responsible for auditing all public sector entities.

0.1.4 Voluntary Response

Not generally relevant to GFS

0.2 Resources

0.2.1 Staff, financial, and computing resources are commensurate with institutional programs.

Within the DIPRES the task of compiling GFS is assigned to three units: the Statistical Unit (Sector Estadísticas, SE), the Coordination Unit (Sector Coordinación, SC), and the Investments and Public Credit Unit (Sector Inversiones y Crédito Público, SICP). The first unit is responsible for compiling annual GFS, and it is composed of a chief and three analysts (only two at present); the second unit is responsible for compiling quarterly GFS, and it is composed of a chief and 5 analysts; the third unit is responsible for compiling government debt statistics, and it is composed of a chief and two analysts (one at present). All technical personnel have a computer assigned for their exclusive use. There are no specific provisions for on-the-job, internal, and external training of government finance staff. However, there is an internal policy of strong support for staff training.

The previous budgetary information system did not allow for full automation of government finance compilation procedures. Linked spreadsheets are currently used to generate GFS from budget execution data. The new budgetary information system (SIAP) recently introduced by the DIPRES, is expected to allow for automation of government finance compilation procedures. New software is being developed for debt data, which is expected to be operational this year.

An information system for financial management of the government is currently under development. It is intended to be a comprehensive tool for financial management, where information will be directly entered into the system by each budgetary unit, and processed automatically thereafter. Once operational, this system will significantly improve the timeliness and overall quality of central government operations data. The system is expected to be ready by 2005.

Available resources are barely sufficient to perform the tasks currently assigned to the three units. Until the new budgetary information system is fully operational, these units would be unable to undertake additional tasks (e.g. compile monthly GFS).

0.2.2 Measures to ensure efficient use of resources are implemented.

The costs associated with compiling GFS are not measured, and it is not known for certain whether resources are used in the most cost-effective way. However, there is a strong concern about the human and financial resources used in compiling and disseminating GFS, and with the efficient use of available resources.

0.3 Quality awareness

0.3.1 Processes are in place to focus on quality, to monitor the quality of the collection, processing, and dissemination of statistics, to acknowledge and deal with tradeoffs within quality, and to guide planning for existing and emerging needs.

There are processes in place to monitor the quality of production and dissemination of GFS. The internal consistency of data, and its consistency over time are closely examined. The trade-offs between quality and other considerations (e.g., timeliness) are acknowledged, and at present favor quality. There is a culture of producing the highest quality product with the resources available and within the established time frame; it is considered a matter of personal and professional pride.

1. Integrity

1.1 Professionalism

1.1.1 Statistics are compiled on an impartial basis

The compilation and dissemination of GFS are not supported by specific laws that establish the professional independence of the agency responsible for GFS, and there are no formal safeguards that ensure the independence of GFS compilation. However, there are strong informal safeguards that support the professional independence of both the agency and the GFS compilation process. These safeguards are of a cultural nature; it is considered inadmissible to have political considerations interfere with the compilation of statistics.

1.1.2 Choices of sources and methods are informed solely by statistical considerations

Statisticians are free from political influence in choosing the most appropriate sources and methods for compiling GFS, and changes to statistical processes are not influenced by political considerations.

The main source for compilation of GFS is the budgetary execution reports that all central government units must submit to the DIPRES, according to the established accounting norms, and which are subject to auditing by the CGR. Furthermore, Congress monitors closely budgetary execution reports.

The methodology of the 1986 GFS Manual has not been legally adopted, however, in practice it underpins the compilation of GFS. In addition, as stated above, quarterly GFS must be published within a specified time frame. Furthermore, Chile is an SDDS subscriber and follows the corresponding guidelines.

1.1.3 The appropriate statistical entity is entitled to comment on erroneous interpretation and misuse of statistics

GFS compilers provide expert advice on technical (not policy) aspects of GFS. The Budget Director makes a technical presentation to the press when the data is released. In addition, public response to misinterpretation of GFS is permitted and exercised.

1.2 Transparency

1.2.1 Terms and conditions under which the data are compiled and disseminated are available to the public

Laws and regulations governing the compilation and dissemination of GFS are freely disseminated to the public. The Annual Budget Law and its complementary regulations are available in Spanish, for a fee, to any interested party.

There are no restrictions on public access to GFS. The only information not publicly available (or included in the GFS) is non-budgetary data related to the military.

1.2.2 Internal governmental access to statistics prior to their release is publicly identified.

There are no special arrangements, whereby the government has access to GFS before publication. No government officials outside the DIPRES have access to the data before they are released to the public, and the data are released simultaneously to all interested parties, via press conference and posting on the DIPRES web site. The data is approved for dissemination directly by the Director of the DIPRES.

1.2.3 Products of statistical agencies/units are clearly identified as such.

Not generally relevant to agencies compiling GFS

1.2.4 Advance notice is given of major changes in methodology, source data, and statistical techniques.

No advance notice is given in preceding GFS publications, and/or in special publications directed to the same audience as the GFS publications, of methodological or other changes, which could materially affect the published data. Major changes in methodology are announced to the public at the time the changes are introduced. Any changes, which cause a break in the time series, are clearly noted in the corresponding publication.

1.3 Ethical standards

1.3.1 Guidelines for staff behavior are clear and publicized.

Compilation and dissemination of government finance statistics are not governed by a published ‘code of conduct’ that ensures that data are compiled and the results presented according to strictly professional considerations. However, there is a culture of proceeding in such manner.

There are reasonable and systematic efforts made to promote professionalism and to benefit from methodological and organizational developments elsewhere. Attendance to courses and seminars is strongly supported, and a comprehensive and up-to-date library is available to staff.

2. Methodological Soundness

2.1 Concepts and definitions

2.1.1 The overall structure in terms of concepts and definitions follow international standards, guidelines, or agreed practices.

GFS compilation and dissemination are generally based on the recommendations of the International Monetary Fund, currently promulgated in the 1986 GFS Manual. The more significant departures are discussed below under Sections 2.2. Scope and 2.3 Classification.

It should be noted that beginning with the Budget Law for 2001 the MOF introduced a new fiscal policy indicator, the central government’s structural balance. The structural balance reflects the level of revenues and expenditures in a context where output reaches its potential and the price of copper is equal to its medium term price, i.e. it excludes the cyclical effects of economic activity and the price of copper. The structural balance is estimated by adjusting the accounting balance (the one reported by the DIPRES to Congress quarterly) in two steps:

• (a) The first step aims to estimate the fiscal deficit based on the concept of net worth (analogous to the approach followed in the revised GFS accrual system), i.e. only transactions that affect net worth determine the deficit. Transactions that do not affect net worth but are included above the line in the accounting balance (and vice versa) are reclassified accordingly (acquisition of securities, proceeds from privatization, sale of financial assets, lending and repayments, gross recording of copper revenues, oil price stabilization fund, and “recognition bonds”),

• (b) The second step aims to exclude the cyclical impact of economic activity on tax revenues, and of copper price fluctuations on copper fiscal revenues.

The MOF intends to supplement the information currently reported to Congress with additional data that allows for the monitoring of the structural balance.

Finally, the DIPRES intends to migrate from the GFS framework based on the 1986 GFS Manual to the revised GFS accrual system once it becomes effective.

2.2 Scope

2.2.1 The scope is broadly consistent with international standards, guidelines, or agreed practices.

The data covers the budgetary units of central government (which include the social security funds managed by the public sector), and the local government units. The extra-budgetary units of central government (of which only the state universities are significant) and special funds dealing with oil and copper prices are not included in the data. According to the guidelines of the 1986 GFS Manual these entities should be included under central government. The authorities pointed-out that universities operate under a regime of full autonomy, and that the inclusion of the funds would distort the analysis of GFS, given their erratic behavior. In addition, certain data related to the military (transfers from Codelco, borrowing, and associated expenditures) are by law considered to be outside the budget, and are therefore not included in GFS; though according to the 1986 GFS Manual they should be.

Data are available on economic flows and stock holdings between general government units, to enable consolidated statistics to be produced. No preliminary data based on partial coverage of the general government sector are published; all data disseminated for the general government are final. At the central government level, data for the first three quarters of the year are preliminary and are replaced by final data at the time the annual figures are published.

All material general government activity is carried out by general government units. However, the data does not include certain entities as indicated above. In addition, the data on local governments does not include municipal corporations that carryout health and education activities. Therefore, no supplementary data on quasi-fiscal activity is provided. The DIPRES also prepares GFS for the non-financial public sector.

Central government debt covers the total gross outstanding direct debt of the central government’s budgetary units, including the social security funds. Data for the extra-budgetary units are not included. It also covers government guaranteed debt.

Quarterly data are disseminated by the DIPRES for central government in a summary table that includes: revenue, broken down by economic type; expenditure, broken down by economic type; and the global (overall) deficit/surplus. The level of detail provided in the quarterly table for revenues and expenditures is significantly less than in tables A and C of the 1986 GFS Manual. Furthermore, no functional classification of expenditure or financing data is provided.

Annual data are disseminated by the DIPRES for both central and general government in summary tables for revenue, broken down by economic type; expenditure broken down by functional classification; expenditure, broken down by economic type; the global (overall) deficit/surplus; and financing, broken down into domestic financing and external financing; and the use of cash funds, which are all domestic. Except for the additional information on financing the summary table for quarterly and annual data are similar. Thus, the level of detail provided in the annual table for revenues and expenditures are again significantly less than in tables A and C of the 1986 GFS Manual. It should be noted, however, that these two revenue and expenditure tables are reported by the DIPRES to STA for inclusion in the Government Finance Statistics Yearbook (GFS Yearbook) with the recommended level of detail.

In addition to the summary table, annual data also include a table on tax revenues by type of tax and a functional classification of expenditure. Finally, the only data provided for financing is net foreign and domestic borrowing, and change in cash and other balances; i.e. no financing tables by type of debt holder or by type of debt instrument are provided (tables D and E of the 1986 GFS Manual).

Annual data on central government debt are disseminated by the DIPRES with a breakdown of total gross outstanding debt based on the residency of the debt holder into domestic and foreign debt, a breakdown by creditor, a breakdown by currency, and debt guaranteed by the central government. No maturity breakdown is disseminated, as there is no short-term outstanding debt. The level of detail provided in the debt tables would allow for compilation of table F (outstanding debt by type of debt holder), however, it does not allow for compilation of a table of outstanding debt by type of debt instrument (table G).

Monthly and annual external debt data are disseminated by the BCCH with a breakdown by creditor, debtor, maturity, public and private sectors, though not by type of instrument. The BCCH is the official entity responsible for compiling and disseminating external debt data. As such it has a comprehensive external debt database, which is regularly updated. The CGR and the Treasury (Tesorería General de la República, TGR) also compile and disseminate debt data in their annual publications.

2.3 Classification/sectorization

2.3.1 Classification/sectorization systems used are broadly consistent with international standards, guidelines, or agreed practices.

Institutional sectors are generally defined in accordance with the System of National Accounts 1993. The exceptions are the extra-budgetary units of central government (of which only the state universities are significant) and the special funds dealing with oil and copper prices, which are not included in central government, as discussed above.

Revenue, expenditure, and financing flows are generally classified using the methodology set out in the 1986 GFS Manual, except for a few cases: (a) Privatization proceeds are divided into two components, book value and excess over book value. The book value is registered as financing and the excess over book value is registered as revenues. The 1986 GFS Manual registers both as repayments under the economic classification of expenditures; (b) Military revenues, expenditures and borrowing considered by law to be outside the budget are not included in GFS; and (c) The functional classification of expenditure follows a Chilean classification, not the United Nations classification (COFOG) used in the 1986 GFS Manual.

2.3.2 The sectors/subsectors for which GFS are produced are in accordance with the draft GFS Manual

Where non-general government agencies are included in GFS, statistics are available for the general government sector separately, as well as for the non- general government sectors, and the consolidated public sector/subsectors. Government finance statistics are provided separately for the central government, local governments, and for the consolidated general government.

2.4 Basis of recording

2.4.1 Accounting is on a cash basis

All transactions are recorded on a cash basis in the period when they actually occur, in line with the 1986 GFS Manual. A move to an accrual basis is being considered in connection with the development of a new integrated information system for the public sector.

The CGR has established the accounting system for the public sector (Sistema de Contabilidad General de la Nación, SCGN), which is based on internationally accepted accounting principles. The SCGN is the single, basic, source of information for all financial information needs.

2.4.2 Market prices (or nearest equivalent) are used to value stocks and flows

All stocks and flows are valued on a current market basis. Chile’s budget is actually composed of two budgets, one in local currency and one in foreign currency. The latter includes all foreign currency transactions. These transactions are converted to local currency using the average exchange rate for the month they take place in the case of quarterly GFS, and using the average exchange rate for the year in the case of annual GFS. Central government outstanding debt data are valued at end period exchange rates and disseminated in U.S. dollars.

3. Accuracy and reliability

3.1 Source data

3.1.1 Source data are collected from comprehensive data collection programs that take into account country-specific conditions.

Data covering a wide range of economic stocks and flows are provided from administrative systems for central and local governments. GFS are based on the accounting records of the actual annual budget execution, as reported monthly by all units of general government to the DIPRES and the CGR. Data are consolidated for the central government sector, and data are available to allow consolidation of data for the different levels of government (general government, non-financial public sector). There are no procedures in place to allow estimation of missing data, as the compilation of GFS is based on complete information. Finally, as indicated above, data for extra-budgetary units and for some military transactions are not available.

Local government administrative data are available with sufficient detail and timeliness. All municipalities report data to the CGR, which in turn provides it to the DIPRES.

3.1.2 Source data reasonably approximate the definitions, scope, classifications, valuation, and time of recording required.

The budget and extra-budgetary charts of accounts align with GFS categories. The budget execution reports of central government units follow the budget classification system issued by the MOF. The DIPRES uses a bridge table to derive an economic classification from the budget classification, and to derive GFS categories in accordance with the 1986 GFS Manual. Furthermore, the timing of recording, and valuation, of source data are generally consistent with GFS concepts.

The previous budget management system did not include provision for automatic derivation of GFS items from budget items, whereas the new system recently introduced will provide such capability, as indicated above.

3.1.3 Source data are timely

The budget management system provides comprehensive and up-to-date records of budget sector transactions. Central government revenue and expenditure data are available 60 days after the end of the reference quarter (45 days beginning in 2001), and financing data are available 90 days after the end of the reference year. Local government data are available 5/6 months after the end of the reference period.

3.2 Statistical techniques

3.2.1 Data collection employs sound statistical techniques

No estimation of missing data or surveys is done, as both central government and general government GFS are based on complete information.

3.3 Assessment and validation

3.3.1 Source data—including censuses, sample surveys and administrative records—are routinely assessed, e.g., for coverage, sample error, response error, and nonsampling error; the results of the assessments are monitored and made available to guide planning.

There are no problems with material gaps in coverage and/or completeness of data collection. As indicated above, GFS are compiled on the basis of complete information.

The GFS for central government are issued within 60 days of the end of the reference quarter (45 days beginning in 2001). The GFS for general government are issued within 6 months of the end of the reference year.

The GFS for central government are preliminary for the first three quarters of the year when issued. These are all revised at the time the GFS for the fourth quarter of the year is issued. The annual central government and general government GFS are final when issued. Should material differences be detected later data are corrected, but such differences rarely occur.

A reasonable degree of consistency can be established between the data published by the DIPRES and those published by the CGR, as both use the same source data.

3.3.2 Main intermediate results are validated against other information where available.

Not generally relevant to GFS

3.3.3 Statistical discrepancies and other potential indicators of problems in statistical outputs are investigated and made available to guide users

The GFS financing data are not reconciled with BCCH monetary or balance of payments data.

3.4 Revision studies

3.4.1 Studies and analysis are used to inform the statistical process

No revision studies or analyses are conducted on a routine basis that could be used to guide and improve statistical processes.

3.4.2 Studies are publicized

Not applicable.

4. Serviceability

4.1 Relevance

4.1.1 Processes to monitor the relevance and practical utility of existing statistics in meeting users’ needs are in place.

The GFS are compiled within the same time frame as budget preparation and monitoring, and are used in the process of determining/evaluating fiscal policy. Quarterly central government budget execution reports are submitted by the DIPRES to Congress within 60 days of the end of the reference quarter, as mandated by the Annual Budget Law (beginning in 2001 the reports will be submitted within 45 days).

4.2 Timeliness and periodicity

4.2.1 Periodicity follows dissemination standards.

No monthly central government operations data are compiled. However, the necessary information for such compilation is available. Only quarterly central government operations data with a two-month lag are currently compiled. Thus, SDDS timeliness and periodicity requirements are not met (monthly, one month). Chile takes a flexibility option for this data category.

4.2.2 Timeliness follows dissemination standards.

Quarterly central government debt data are compiled with a one-month lag by the DIPRES, but they are not disseminated. Annual central government debt data are compiled and disseminated with a ten-month lag, although the data are available much earlier. Thus, SDDS timeliness and periodicity requirements are not met formally (quarterly, one quarter). Chile takes a flexibility option for this data category.

The timeliness of general government operations annual data is 2 quarters after the reference period. Thus, SDDS timeliness and periodicity requirements are met (annual, two quarters).

Central government operations data are not published monthly, only quarterly and annually. General government operations data are published annually. Finally, central government debt data are not published quarterly, only annually.

4.3 Consistency

4.3.1 Statistics are consistent or reconcilable over a reasonable period of time.

Divergences from the expected trend in the revenue and/or expenditure time series are related to the underlying fiscal policy and/or economic developments. Previous series are adjusted to account for discontinuities arising from methodological developments and changes in the statistical system. Breaks in time series are clearly identified and fully explained.

4.3.2 Statistics are internally consistent (e.g., accounting identities observed).

The overall deficit/surplus is equal to total financing (with the opposite sign). Each is calculated separately and any discrepancy investigated and corrected. No component is derived residually. This unusual consistency between the above the line and below the line data has its origin in the use of a double entry accounting system, whereby each entry automatically generates a counterpart entry.

The overall deficit/surplus equals total revenue and grants minus total expenditure and lending minus repayments. The components of revenue, expenditure, and financing add to aggregates.

Quarterly central government operations data coincides with annual data, except for differences due to the exchange rate used, as detailed above. Finally, the sum of GFS aggregates for component levels of government, equal aggregates for the consolidated combination of those subsectors, less consolidation adjustments.

4.3.3 Statistics are consistent or reconcilable with those obtained through other data sources and/or statistical frameworks.

The GFS data used for national accounts purposes are provided by the CGR, not the DIPRES. The DIPRES is discussing with the BCCH the possibility of providing such data, which would then be consistent with related national accounts aggregates.

GFS financing data are not reconciled with banking data and changes in government financial assets and liabilities held by other sectors. Finally, GFS data for foreign debt, and foreign grants and financing transactions, are not reconciled with BOP data.

4.4 Revision policy and practice

4.4.1 Revisions follow a regular, well-established and transparent schedule

The release of revised data follow a well established and understood schedule. The data for the first three quarters of the year are revised at the time the data for the fourth quarter is released (i.e. 60 days after the end of the quarter in the past, 45 days beginning in 2001). The data for the fourth quarter and for the year as a whole are final when first released.

4.4.2 Preliminary data are clearly identified.

Preliminary and revised data are not identified in the published statistics. However, users are aware of the revision policy followed by the DIPRES. The revised data are disseminated in the same way, and at the same level of detail, as the original data. Finally, the coherence between preliminary and final data is sufficient to allow preliminary data to be used with confidence for policy determination and analysis.

4.4.3 Studies and analyses of revisions are carried out routinely and made public

Revisions incorporate all material data changes resulting from available up-to-date data. No time series of revisions to data is made available. The revisions made are based on supporting documentation. Finally, no analyses of preliminary versus revised data published for major GFS aggregates for the preceding periods are conducted.

5. Accessibility

5.1 Data accessibility

5.1.1 Statistics are presented in a way that facilitates proper interpretation and meaningful comparisons (layout and clarity of text, tables, and charts).

Government finance data are presented in a way that facilitates proper interpretation and meaningful comparisons. The figures for the period in question are compared with figures for previous periods, both in real terms and in terms of GDP. The figures are also compared with the budget for the period. However, as noted above, the degree of detail provided for the major GFS aggregates is significantly less to that set out in the 1986 GFS Manual tables.

The information presented is suitable for use in the budget development and monitoring process, and other government economic and fiscal policy development. Beginning in 2001 the authorities have introduced adjustments to the accounting balance to obtain a structural balance, which is considered more appropriate for fiscal policy purposes, as discussed above.

5.1.2 Dissemination media andformats are adequate.

The Annual Budget Law requires that data on the quarterly budget execution of the central government revenue and expenditure be sent to Congress within 60 days after the end of the reference quarter (45 days beginning in 2001). Furthermore, at the same time, the data is distributed to the local press at a conference held by the Budget Director.

There is a dedicated annual government finance publication, titled “Estadísticas de las Finanzas Públicas”. Quarterly government finance statistics (revenue, expenditure, surplus/deficit) are published in a quarterly report titled “Informe de Ejecución Trimestral de la Ley de Presupuestos”. The tables in the annual and quarterly publications are also posted in the DIPRES’s website. Monthly government finance statistics are not compiled. Finally, there is an annual debt publication titled “Proyección del Servicio de la Deuda del Gobierno Central y Empresas Públicas”, which contains both historical and projected debt data. This document has limited distribution, and the data are not posted in the DIPRES’s website.

5.1.3 Statistics are released on a pre-announced schedule.

The date of release of GFS publications is announced substantially in advance. An advance release calendar that provides one-quarter-ahead notice of the approximate release dates is disseminated on the Central Bank of Chile’s Internet website. The calendar is also published in the Central Bank’s fortnightly publication “Informe Económico y Financiero”. The precise release dates are announced no later than the end of the week prior to the release of the data. The actual date of publication meets the pre-announced date.

5.1.4 Statistics are made available to all users at the same time.

Statistical publications are made available to all users simultaneously, and without preferential treatment of selected users. As indicated above, the same day the quarterly report is sent to Congress the data are released at a press conference and posted in the DIPRES website.

5.1.5 Nonpublished (but nonconfidential) sub-aggregates are made available upon request.

The availability of non-published data, and the terms and conditions on which it is made available, are not publicized in GFS publications. However, non-published data are made available to users upon request.

5.2 Metadata accessibility

5.2.1 Documentation on concepts, scope, classifications, basis of recording, data sources, and statistical techniques is available, and differences from international standards are annotated.

Concepts, sources, and methods (C, S, & M) are documented, and revisions to C, S, & M published at the same time as the data they affect. The quarterly publication “Sector Público Ley de Presupuestos” includes a brief note on methodology, while the annual publication “Estadísticas de las Finanzas Públicas” includes a more detailed methodological description. Methodological notes are also disseminated through the DIPRES’s website. The publication “Deuda del Gobierno Central” contains a brief note on methodology. Summary methodological statements have not yet been published in the DSBB.

C, S, & M documentation does not identify differences from internationally accepted standards, or provide candid description of coverage and compilation problems. Finally, bridge tables showing the links between source data and GFS have never been requested, but in principle would be made available.

5.2.2 Different levels of detail are provided depending on intended audience and type of collection.

The methodological notes included in the various publications are considered adequate to allow both general and expert users to assess the strengths and weaknesses of the government finance statistics published. Further information on methodological aspects is made available upon request.

5.3 Assistance to users

5.3.1 Contact person for each subject field is publicized.

The contact person for GFS is publicized. Prompt and knowledgeable service and support is available. Finally, there is a policy of responding promptly to the misuse of government finance data, but there are no specific provisions to educate the users of government finance statistics.

5.3.2 Catalogues of publications, documents, and other services, including information on any charges, are widely available.

No.

D. Monetary Statistics

0. Prerequisite of Quality

0.1 Legal and institutional framework

0.1.1 The responsibility for compiling monetary statistics is clearly specified.

The compilation and dissemination of monetary statistics are governed by the terms and conditions of the 1989 Act of the Central Bank of Chile (Law 18840). Additionally, the BCCH participate in the National Plan for the Collection of Statistics (Plan Nacional de Recopilación de Estadística, PNRE), which assigns to this institution the task of compiling and disseminate the balance of payments statistics. The PNRE is designed and approved by the President of the Republic each year.

The collection and dissemination of monetary statistics is guaranteed under Article 53 of the Act on the BCCH. The Constitutional Organic Act of the Central Bank of Chile, Law Number 18840 of October 1989, stipulates in Article 53 that “the Bank shall compile and publish, in a timely manner, the principal macroeconomic statistics of the country, including monetary and foreign exchange statistics, balance of payments statistics, and the national accounts.”

In addition, the coverage, periodicity, and timeliness of these statistics are established by Decision No. 393-07-941207 of the Central Bank Board of Directors, published in the Official Gazette on December 13,1994.

The Research Department (DE) of the BCCH is in charge of the collection of the source data and the compilation and dissemination of monetary statistics.

0.1.2 Data sharing and coordination between data producing agencies are adequate.

Formal procedures have been established within the BCCH that govern the reporting of information to the DE by other departments, the Superintendency of Banks and Financial Institutions (Superintendencia de Bancos e Instituciones Financieras, SBIF), and individual commercial banks and finance companies. The Accounting Department prepares the BCCH accounting data, which is accessed electronically by the DE. The SBIF reports to the DE monthly balance sheets data on commercial banks and finance companies. Furthermore, an on-line system called “SINACOFI” connects the BCCH, the SBIF, and all commercial banks and finance companies. Through this system, the BCCH receives daily information on interest rates, the information needed to compile the monetary aggregates, and the provisional figures for the monthly survey of the other depository corporations. Therefore, balance sheet data is received by the BCCH through two channels: (1) comprehensive monthly information transmitted by the SBIF; and (2) data transmitted daily through SINACOFI to compile the provisional monthly other depository corporations’ survey.

The BCCH and the SBIF consult on new projects that have the potential to modify report forms for the banks’ balance sheets and profit and loss accounts, which are jointly used by both institutions for statistical and supervisory purposes. In this regard, an extensive revision of the plan of accounts applied to commercial banks and finance companies is being carried out by the SBIF. Owing to the early stage of the project, there was no need for consultation with interested parties, such as the BCCH. However, senior representatives of the SBIF indicated their willingness to include experts from the BCCH in the process of revision for those issues of interest to the Bank. Issues such as appropriate sectorization of accounts to facilitate macroeconomic analysis, as well as the provision of complementary information to fill the gap between book and market values of financial assets and liabilities, may greatly benefit from the close collaboration of the two Institutions.

0.1.3 Confidentiality of reported data

There are internal rules aimed at avoiding disclosure of confidential data. Furthermore, penalties are imposed to the staff that discloses confidential data. In addition, computer applications exist to safeguard against the exposure of confidential data. However, it is worth noting that the BCCH publishes monetary statistics, including data on individual institutions, as part of its efforts towards complete transparency in its activities. The publication of detailed data by institution is a traditional practice in the BCCH (i.e. for the last 25 years).

The confidentiality of data is guaranteed under Article 66 of the BCCH’s Organic Act as well as by the Bank’s Staff Code of Conduct (Reglamento de Personal) under section “conflict of interest.” The latter prohibits the staff from disseminating confidential information, i.e. any information that has not been published. Additionally, the employment contract states that “It will be justified reason for the termination of the employment contract the non-fulfillment of the following obligation: Maintain absolute secrecy of the situations or businesses that, directly or indirectly, were connected to the Bank and that were known owing to the staff position or functions as well as keep full loyalty to the Bank.”

The disciplinary measures range from a verbal warning to the termination of the contract of employment.

With regard to the confidentiality maintained through computer applications, the internal administrative rules note: “Confidentiality of the information: All pieces of information stored in the computer systems or services are define as private. Therefore, it is prohibited to disseminate or distribute any kind of information obtained from those systems to parties not defined in the administrative rules of each unit.” Furthermore, as far as manipulation of data or programs is concerned, the administrative regulation states: “Every system or computer service should be used taking into consideration the functions that have been defined to them. This implies that it is prohibited to modify data through mechanisms not defined in the system or service, to modify programs or to modify computer procedures.” Finally, a chapter on security measures states: “Those persons using the official software or that elaborate applications to support the functions of the Bank, should be authorized by the Chief of the Department within its Unit and observe the rules defined by the Computer Manager.”

0.1.4 Statistical reporting is legally mandated.

Commercial banks, finance companies and savings and loan cooperatives are obliged to report data to the SBIF. The Article 53 of the Central Bank Organic Law requires the SBIF to report these data to the BCCH. Commercial banks and finance companies also provide data directly to the BCCH. Sanctions are not defined for those not complying with the BCCH’s requests of information.

0.2 Resources

0.2.1 Staff and other resources

The DE has 5 staff, three of which are professionals and two administrative. In addition, there is a full time position of a senior economist specialized in monetary issues. The academic qualifications and technical skills required for employment are high. The average years of experience is above 15. In addition, there is a procedures manual for the compilation of monetary statistics, to be used in case of an absence or arrival of a new employee.

The systems of data collection and compilation are highly computerized. Depository corporations submit report forms by electronic means. There are no budgetary constrains to carry out improvements in the system.

0.2.2 Cost-effectiveness measures

There are measures in place that monitor the cost-effectiveness of the program for compiling monetary statistics. In particular, each year prior to the finalization of the annual budgetary process of the BCCH, evaluations are carried out on the current systems to review the need for improvements.

0.3 Quality awareness

0.3.1 Processes have been established to monitor the quality of the production and dissemination of statistics.

There are processes to monitor of the quality of the statistics produced by the BCCH. In particular, there is an on-going work on setting up an integrated data base covering all the data disseminated by the BCCH - currently, the specific data-sets, such as national accounts, balance of payments or monetary statistics, are maintained in separate data bases for which each compiling unit is responsible. The integrated database may be expanded in the future to include data of internal use also.

Owing to the importance attached to the data on international reserves, a cross checking is periodically carried out between the Balance of Payments and the Accounting Departments to monitor these data. The DE also monitors this indicator closely.

1. Integrity

1.1 Professionalism

1.1.1 Impartiality in the compilation of statistics

The statutory provisions under which the BCCH compiles monetary statistics are adequate to guarantee independence of the staff in conducting these functions. Furthermore, impartiality is guaranteed through the publication of statistics on depository corporations on an individual basis. In addition, in the opinion of the authorities, inaccuracies in published data would entail a loss of credibility for the BCCH.

1.1.2 Choices of sources and methods are informed solely by statistical considerations.

In compiling monetary statistics, the methodological framework is designed to comply with the IMF’s recommendations as suggested in the SDDS guidelines. Furthermore, there are plans to devote resources in the near future to the implementation of the new MFSM.

1.1.3 Commentaries prepared by the BCCH on erroneous interpretation and misuse of statistics

In the prospective case of changes in the presentation of disseminated data or the need to explain complicated statistical formulations, the Gerencia Division de Estudios (GDE) would be in a position to provide explanations to the press or other interested users.

1.2 Transparency

1.2.1 Availability of the terms and conditions under which statistics are produced and disseminated

An advanced release calendar that gives the precise dates for the next four months is disseminated on the BCCH’s Internet website. The calendar is updated every month.

1.2.2 Prior government access to statistics is identified

Monetary statistics are disseminated simultaneously to all interested parties every fortnight. However, a reduced set of preliminary indicators is monitored on a daily basis. Following approval of the daily data produced by the DE, a limited number of senior BCCH staff has access to them.

1.2.3 Identification of statistical products by statistical agencies

The DE of the BCCH is identified as the source of the central bank and the other depository corporations’ surveys.

1.2.4 Advance notice is given of major changes in methodology, source data, and statistical techniques.

Changes in methodology, source data, or statistical techniques are communicated simultaneously with the release of the data. Furthermore, the correct interpretation and treatment of the historical series in support of the changes are provided.

1.3 Ethical standards

1.3.1 Guidelines covering staff behavior are publicized

Guidelines covering staff behavior are not deemed as necessary within the BCCH, and therefore do not exit, owing to its very transparent policy of publishing data on individual financial institutions.

2. Methodological soundness

2.1 Concepts and definitions

2.1.1 The analytical framework underlying the monetary statistics follows internationally endorsed standards.

The analytical framework underlying the monetary statistics follows internationally endorsed standards. Currently, a program to improve the monetary and financial statistics is being developed, which aims at revising the local definitions of the monetary aggregates and incorporating other financial intermediaries into the coverage. These revisions should result in greater consistency with the MFSM directives.

Central Bank Survey

The analytical framework used by the BCCH (Assets and Liabilities of the Central Bank) reflects an approach aimed at quantifying, by means of institutional sectorization, the factors that have an impact on the issuance of Central Bank liabilities that contribute to the formation or constitute part of those liabilities included in the local definition of private monetary aggregates.

The main departures from the guidelines of the MFSM are: (a) the inclusion of nonbank financial intermediaries in the Private Sector; and (b) the use of accounting valuation criteria that are not always in line with the measurements at market prices prescribed by the MFSM (see accounting conventions). However, the accounting criterion for purposes of expressing in local currency terms assets and liabilities in foreign exchange and indexed units of account is consistent, in general terms, with the MFSM.

Depository Corporations Survey

The analytical framework used by the BCCH (Table of Assets and Liabilities of the Banking Sector) attempts to quantify, by means of an institutional sectorization, the factors affecting the issuance of private monetary aggregates. Given that the local definition of private monetary aggregates includes only liabilities issued by the Central Bank, Commercial Banks, and Finance Companies, this table is prepared by totaling and consolidating the balance sheet accounts of these institutions.

The balance sheet data used as primary source to compile the other depository corporations surveys reflect concepts and principles that are, in general, consistent with international accounting standards. Moreover, the plan of accounts for commercial banks and finance companies, which needs some adaptation to recent international guidelines, is currently under review by the SBIF.

The main deviations from the MFSM are: (a) the inclusion of nonbank financial intermediaries in the Private Sector; and (b) the use of accounting valuation criteria, which do not always coincide with the market price measurements prescribed by the MFSM. Nevertheless, for purposes of expressing in domestic currency, assets and liabilities denominated in foreign currency or in indexed units of account; the accounting criterion is compatible, in general terms, with the MFSM.

2.2 Scope

2.2.1 Comprehensiveness of institutional coverage

The depository corporations sector comprises the BCCH, 44 other depository corporations, including 28 commercial banks, one bank owned by the State, one finance company, 16 mutual funds, and two major saving and loan cooperatives²¹. The depository corporations survey (banking sector) compiled by the DE of the BCCH does not include mutual funds and saving and loan cooperatives. However, the work program of the current year includes the incorporation of mutual funds into the survey, while saving and loan cooperatives are not under consideration because of their reduced importance.

Mutual funds and saving and loan cooperatives represent a 7.7 percent and 0.5 percent of the current definition of money and cuasi-money, respectively (with the consolidation process, this percentage is lower).

2.3 Classification/sectorization

2.3.1 Consistency with international standards

The principles underlying the classification of financial instruments and the sectorization of institutional units are, with few exceptions, based on international standards.

The main exception is that the definition of private sector includes not only the 1993 SNA households, nonfinancial corporations and NPISH sectors, but also those financial corporations that are excluded in the definition of the depository corporations’ survey (i.e. mutual funds, saving and loan cooperatives, and other financial corporations.) Furthermore, monetary statistics do not comprise flow statistics. However, for internal use, a flow statement for the BCCH is prepared, which distinguishes cash flows, revaluations, and interest accrued.

2.3.2 Principles of classification

The principles of classification of financial instruments are generally consistent with international standards. However, source data to compile the other depository corporations survey do not separately identify financial derivatives and insurance technical reserves, which are both included as unclassified assets and liabilities. During 1999, net unclassified assets and liabilities averaged 8 percent of the total assets in the other depository corporations’ survey.

Accounts representing adjustments, which do not represent assets or liabilities in economic terms, are included in the survey. The most important of these accounts are the Cuentas de Conversion y Cambio (accounts of conversion and exchange), which are intermediate accounts aimed at separately recording operations in national and foreign currencies. For the latter, the effect of the fluctuations in the exchange rate is identified. The balance of the Cuentas de Cambio is equivalent, but with the opposite sign in the Cuentas de Conversion. This balance represents the deficit or surplus in national currency, which is compensated with a surplus or deficit in foreign currency.

Central Bank Survey

The assets side shows the net balances resulting from calculating debit balances minus credit balances not included as monetary liabilities, grouped in sectoral classifications which evaluate, in general terms, gross balances of credit to the Private Sector and net balances of credit to the remaining sectors. The sectoral specification, which is consistent with that described in the SDDS, includes the External Sector (broken down into International Reserves and Other); General Government; Private Sector; Rest of the Banking Sector; and Other. In the case of the Banking Sector, the net balance of credit corresponds to assets minus liabilities (other than base money and notes) with a secondary market.

The liabilities side shows the balance of base money (broken down into currency held by the public and monetary reserves) and Central Bank paper that is traded on secondary markets.

Depository Corporations Survey

On the assets side, it includes the net balances obtained by taking the debit balances less credit balances not included as monetary liabilities, grouped in sectoral classifications that evaluate, in general terms, the gross balances of credit to the Private Sector and net balances of credit to the remaining sectors. The sectoral breakdown, which is compatible with the SDDS requirements, includes the External Sector (broken down into International Reserves and Other); General Government; Private Sector, and Other.

On the liabilities side, it includes the balances of money and near money held by the private sector, broken down into banks (issued by commercial banks and finance companies) and instruments of the central bank. Private money includes cash held by the general public, current accounts and other sight deposits in domestic currency of the Private Sector, and sight savings accounts. Near money includes time deposits in domestic currency of the Private Sector, foreign currency deposits of the Private Sector, mortgage letters of credit in circulation (i.e., those not acquired by the Banking Sector), and time savings deposits. Instruments of the Central Bank include those with a secondary market and in circulation (i.e., those that do not form part of the investment of the Commercial Banks and Finance Companies.)

2.3.3 Principles of sectorization

The principles of sectorization applied in the monetary statistics are generally consistent with international standards, grouping similar kinds of institutional units with respect to their objectives, functions, and economic behavior. However, a deviation from these standards has been identified: the definition of private sector includes not only the 1993 SNA households, nonfinancial corporations and NPISH sectors, but also those financial corporations not included in the definition of the depository corporations survey (i.e. mutual funds, saving and loan cooperatives, and other financial corporations.) Furthermore, public nonfinancial companies cannot be separately identified and are included in “other internal credit, net”, together with own funds and unclassified assets and liabilities.

Central Bank Survey

The residency criterion that is used to distinguish between net foreign assets and domestic assets is based on the IMF’s Balance of Payments Manual (5th edition).

The Banking Sector includes the Central Bank, commercial banks (including the Banco del Estado, the only publicly held commercial bank), and finance companies. The latter, as in the case of commercial banks, accept deposits included in the local definition of private money.

In accordance with the definition set forth in the IMF’s Monetary and Financial Statistics Manual (MFSM), the General Government Sector includes entities from the central government and local government (municipalities). In Chile there are no state government entities. The public social security funds are national in scope and included within Central Government. The rest of the public sector, namely publicly held nonbank corporations, is included in “other internal credit, net.”

The Private Sector includes all domestic entities not included under the definitions of Banking Sector or Public Sector. Thus, it includes private nonfinancial entities as well as private financial intermediaries, such as mutual associations, savings and loan cooperatives, insurance companies, and pension funds, which do not constitute part of the Banking Sector.

Depository Corporations Survey

The residency criterion that is used to distinguish net external assets from domestic assets is based on the IMF Balance of Payments Manual (5th Edition).

In accordance with the definition in the IMF Monetary and Financial Statistics Manual (MFSM), the General Government Sector includes Central Government and Local Government (Municipalities) entities. Since Chile is a unitary state, there are no State Government entities. Public social security funds are national in scope and are included in Central Government. The rest of the public sector (i.e., privately owned nonbank corporations) is included in “Other.”

The Banking Sector includes the Central Bank, commercial banks (including the Banco del Estado, which is the only government-owned commercial bank), and the finance companies. The latter, like the commercial banks, take deposits included in the local definition of private money and receive credit from the Central Bank. The net balance of operations within the banking sector, theoretically zero, is included in “Other.”

The Private Sector includes all domestic entities not included in the definitions of the Banking Sector or the Public Sector (i.e., it includes private nonfinancial entities and private financial intermediaries, such as mutual funds, savings and loan cooperatives, insurance companies, and pension funds which are not part of the Banking Sector).

2.4 Basis of recording

2.4.1 Use of accrual accounting

The accrual accounting guidelines recommended by the MFSM require that interest accruing on deposits, loans, and securities other than shares be incorporated into the outstanding amount of the financial asset or liability, rather than treated as part of other accounts receivable/payable. Accrual accounting is used in these terms in the BCCH balance sheet. However, the other depository corporations’ balance sheet does not provide for the allocation of accrued interest into the outstanding amount of the financial asset or liability of origin. Therefore, interest accrued are included in net unclassified assets and no estimation techniques to allocate them into their proper categories are applied.

2.4.2 Valuation principles

The valuation principles applied in the monetary statistics are broadly consistent with international standards. However, assets negotiable on secondary markets are not always valued at market prices, but at the lower of historical cost or market price; liabilities are valued in accordance with the trend value of attracting them (central bank survey) or at historical cost (other depository corporations survey).

The general recommendation of the MFSM is that financial assets and liabilities should be valued on the basis of market prices or market-price equivalents. The valuation of loans is an exception to this principle; loan values should be based on creditors’ outstanding claims without adjustment for expected loan losses. This amount comprises the outstanding principal plus any accrued interest and is referred to as the book value of a loan. This valuation principles are, however, not compatible with the plan of accounts for commercial banks, which is based on book values. Market valuation is applied only if it is lower than the book value.

Consistent with the recommendations of the MFSM, the loan portfolio and deposits on the balance sheets of the depository corporations are valued at book values. Loan valuation is not adjusted for expected loan losses; provisions for expected losses are recorded as separate entries on the liability side of the balance sheet.

Financial instruments denominated in foreign currency are converted into national currency values at the market exchange rate prevailing at the balance sheet date. Monetary gold is valued at an average of its price during the last quarter with an additional reduction.

2.4.3 Aggregation and consolidation

The CBS, ODCS, and DCS are consolidated statements. In the consolidation, stocks and flows that occur between institutional units within depository corporations are eliminated.

2.4.4. Recording on a gross basis

Assets and liabilities are originally compiled on a gross basis. However, for purposes of presentation in the analytical accounts, they are netted out for all sectors except for the private sector.

3. Accuracy and Reliability

3.1 Source data adequacy

3.1.1 Comprehensiveness, timeliness, and accuracy

The source data for compiling the central bank survey are the accounting records of the BCCH prepared by the Accounting Department, which are available on a daily basis.

The basic data sources for the other depository corporations survey are the individual monthly report forms of the other depository corporations (commercial banks and finance companies only). The reported data are disaggregated in terms of instruments and sectors to permit a sufficient analysis of the accounting data to derive the monetary accounts. However, there are cases of insufficient information for instrument and sectoral breakdowns (see sections 2.3.2 and 2.3.3 for further details).

Preliminary data are compiled and disseminated by using a more simplified, alternative source to the monthly report forms. This source is a daily report form with 35 data received directly from banks through an electronic transmission system called “SINACOFI.” These data is sufficient for the publication of the analytical accounts in the fortnightly and monthly bulletins.

The source data for compiling the central bank and the other depository corporations’ surveys are subject to internal consistency checks. In particular, a crosscheck is carried out among the various report forms (aggregate data in the balance sheets and the disaggregated data in the annexes) prepared by each single financial institution. Furthermore, the DE occasionally verifies the accuracy of the data by checking the corresponding interbank positions reported by the BCCH and the Other Depository Corporations.

3.1.2 Suitability of the source data for compiling analytical accounts

The source data reasonably approximate the definitions, scope, classifications, time of recording, and valuation required.

3.1.3 Source data are timely

The Accounting Department of the BCCH prepares accounting data for the central bank on a daily basis, which are available at the end of the following day. Source data for the ODCs are available from report forms that are prepared on a preliminary, daily basis. The data for the banks are reported by electronic means using a network for the transmission of financial data called SINACOFI.

3.2 Statistical techniques

3.2.1 Soundness of statistical methods

The statistical techniques used to compile monetary statistics are automated. In processing source data, computerized files are used that incorporate standardized macros. For the other depository corporations’ survey, estimates for non-responding banks are not needed since the information is received on a daily basis and the DE has at least seven days to request data that might be on delayed.

Accrued interests broken down by instrument are not estimated, but this amount is registered under the unclassified asset and liabilities account.

3.3 Assessment and validation

3.3.1 Evaluation of source data and results

Report forms used by the ODCs are occasionally revised to reflect changes in the presentation of accounting records and the needs of compilers. A regular revision procedure does not exist since only the SBIF is in charge of providing instructions to open new accounts in cases where new types of operations were authorized. The DE, for its part, is obliged to identify and appropriately classify the new accounts because of the requirements of the electronic transmission mechanism used to compile the data.

As regard the daily data directly reported to the BCCH by the ODCs, the DE revises the report forms in cases where new requirements for information arise.

3.3.2 Results are validated against other information

The DE checks large and unexplained fluctuations in the time series compiled. However, there is no standardized set of plausibility checks in place.

The data on financial market operations are occasionally used to check the ODCs’ balance sheets.

3.3.3 Investigation of errors

Errors in the reported data are investigated and letters are sent to the responsible depository corporations for their correction.

3.4 Revision studies

3.4.1 Studies and analysis are used to inform the statistical process

No studies or analyses are conducted on a routine basis that could be used to guide and improve statistical processes.

3.4.2 Studies are publicized

No.

4. Serviceability

4.1 Relevance of information

4.1.1 Systems exist to monitor users’ needs.

There is an informal process of conducting periodic reviews with the policy departments of the BCCH. The DE reviews developments that have an impact on statistical data requirements with the BCCH’s departments that analyze the data. Moreover, the BCCH regularly participate in international meetings and seminars organized by international statistical organizations, such as the IMF and the United Nations.

4.2 Periodicity and timeliness

4.2.1 Periodicity follows dissemination standards.

The surveys of the BCCH and of the other depository corporations sub-sectors are disseminated on a fortnightly and monthly basis, respectively, which is consistent with the specifications of the SDDS.

4.2.2 Timeliness follows dissemination standards.

The central bank survey is disseminated one week after the end of the reference date, and the other depository corporations survey is disseminated three weeks after the end of the reference month, which is in keeping with the specification of the SDDS.

4.3 Consistency

4.3.1 Consistency of data over time

The data on the BCCH and the other depository corporations’ surveys are consistent over time. Methodological notes are maintained, although not disseminated, for time series data describing major breaks in the series, their causes as well as adjustments made to maintain consistency over time.

4.3.2 Internal consistency of data

The data on the BCCH and the other depository corporations’ surveys are internally consistent. Interbank positions between the BCCH and the ODCs are also occasionally checked for consistency. The mission confirmed that differences in interbank positions were minor.

4.3.3 Consistency with other statistical frameworks

The DE routinely cross checks data on the net foreign assets positions of the BCCH and the other depository corporations sub-sectors with the corresponding measures derived from the international investment position.

The DE does not check whether net credit to government from the depository corporations’ subsector is consistent with or reconcilable with government borrowing from the banking system as recorded in the government finance statistics.

4.4 Revision policy and practice

4.4.1 Transparency of revision policies and practices

Revision policies follow a regular pattern. The data for the BCCH and the other depository corporations surveys are preliminary when first released and are finalized within one month and two months, respectively, except in case of the year-end data, which are finalized three or four months after the end of the reference year. However, final data are not frequently checked against preliminary data.

4.4.2 Preliminary data are clearly identified.

Revisions made to the BCCH and the other depository corporations’ surveys are clearly identified in the fortnightly and monthly reports of the BCCH and in the statistical releases posted on the web site.

5. Accessibility

5.1 Data accessibility

5.1.1 Presentation of data facilitates interpretation and understanding.

Published monetary statistics are supplemented by the dissemination of tables, charts, and text. Moreover, the means of disseminating monetary statistics are adequate and suitable for the users’ needs. In addition, there is an on-going work to provide the users several file format options, such as Acrobat-Reader and Excel.

5.1.2 Adequacy of dissemination formats

Monetary data are disseminated in many formats including the BCCH’s fortnightly and monthly reports, and on the BCCH website, (http://www.bcentral.cl, under “Indicadores Económicos” or “economic data”). The menu can also be displayed in English.

5.1.3 Statistics are released on a pre-announced schedule.

An advance release calendar that provides a quarter-ahead notice of the precise release dates is published on the Central Bank of Chile’s Internet website (http://www.bcentral.cl/Indicadores/calendario/release.htm) in English and Spanish.

The advanced release calendar is updated monthly and also published in each issue of the BCCH’s publication “Informe Económico y Financiero” in Spanish and English.

5.1.4 Statistics are made available to all users at the same time.

The data are released simultaneously to all interested parties through the publication of the “Informe Económico y Financiero” (Economic and Financial Report), which appears fortnightly. The publication is available for sale to the public, between 9:00 - 9:30 a.m. on the days on which it is released (the 7th and the 23rd of each month, or the following working days if they are holidays). Subscribers may also pick up their copies at that time or have them mailed directly.

Simultaneously “Informe Económico y Financiero” is also published on the Central Bank’s Internet website (http://www.bcentral.cl, under ‘Publicaciones’).

5.2 Metadata accessibility

5.2.1 Documentation of methodological principles underlying the statistical framework

The statistical concepts, scope, classifications, basis for recording, data source, and statistical techniques are available to the public.

The compilation procedures were revised during 1998. New series and a methodological note were published in the Central Bank’s monthly bulletin of February 1999. A hard copy of the methodological note can be obtained from the BCCH’s contact person for monetary statistics. Furthermore, summary methodologies for the analytical accounts of the Central Bank and the banking sector will be posted in the IMF’s DSBB very soon.

5.3 Assistance to users

5.3.1 Public availability of the names of contact persons

There are provisions to offer adequate assistance to internal and external users. The BCCH’s Internet website (http://www.bcentral.cl/) offers the possibility of addressing queries to the Bank.

5.3.2 Public Availability of information on other related services

Catalogues of publications, other services, and fees are available.

E. Balance of Payments Statistics

0. Prerequisites to Integrity

0.1 Legal and institutional environment

0.1.1 Assignment of responsibility for BOP data compilation and dissemination

The compilation and dissemination of the balance of payments (BOP) data are governed by the terms and conditions of the 1989 Constitutional Organic Act of the Central Bank of Chile (Law 18840). Article 53 of the Act on the BCCH states that the Central Bank must compile and publish on a timely basis the country’s main economic information: monetary and financial, balance of payments, and national accounts statistics. Additionally, the BCCH participates in the Plan Nacional de Recopilación de Estadísticas (PNRE), which assigns it the task of compiling and disseminating the balance of payments statistics.

0.1.2 Arrangements or procedures to facilitate effective inter-agency coordination between the BCCH and BOP source-data producing agencies.

Article 53 of the BCCH Act designates it as an organ of the official statistical service, thereby providing the legal basis for inter-agency coordination as well as for requesting data. Article 53 states: “The Bank shall have the authority to request and obtain from various agencies and departments of the Civil Service Administration, decentralized entities, and generally the public sector, any information it may deem necessary.” In addition, Article 40 allows the BCCH to request information on foreign exchange transactions from private institutions.

At an operational level, the BCCH has agreements with several source-data producing institutions: (1) Agreement with the Customs Service (Servicio Nacional de Aduanas) for information on exports and imports, which are obtained weekly through a direct line that assures the provision of information to the BCCH as soon as the data are available, (2) Agreement with the National Tourism Service (Servicio Nacional de Turismo, SERNATUR) for travel services, (3) Agreement with the International Police (Policia Internacional) for numbers of travelers.

The following institutions provide source data to the BCCH without formal agreements or through their regular publications: (1) Foreign Investment Committee (Comité de Inversiones Extranjeras) for supplementary information on foreign investment in Chile through surveys and administrative requirements; (2) Banking and Financial Institutions Superintendence (Superintendencia de Bancos e Instituciones Financieras, SBIF), the information provided by the banking system is through SINACOFI (Sistema Nacional de Comunicación Financiera), which is an on-line system that connects the BCCH, the SBIF and all commercial banks and financial companies; (3) Stock Exchange and Insurance Superintendence; and (4) Pension System Superintendence for data on direct investment funds.

0.1.3 Confidentiality of respondents’ data is guaranteed and their use is restricted to statistical purposes.

The confidentiality of data reported by individual persons and entities is guaranteed under Article 66 of the BCCH Act as well as by the Code of Conduct of the Bank (Reglamento de Personal, section conflict of interest). The latter prohibits dissemination of confidential information by staff, i.e., any information that has not been published. Additionally, the employment contract states that “It will be justified reason for the termination of the employment contract the non-fulfillment of the following obligation: Maintain absolute secrecy of the situations or businesses that, directly or indirectly, are connected to the BCCH and that are known owing to the staff position or functions as well as to keep full loyalty to the BCCH.”

0.1.4 Statistical reporting ensured through legal mandate and/or measures implemented to encourage voluntary response.

Articles 39, 40, 53, and 58 of the Central Bank Act ensure statistical reporting to BCCH of all foreign exchange operations and provide the legal basis for requesting information on the balance of payments to both public and private institutions.²²

0.2 Resources

0.2.1 Staff, financial and computing resources

The Balance of Payments Department of the Information and Statistical Research Management of the BCCH are responsible for producing the balance of payments statistics.²³ The department has a permanent staff of 12 (9 professional and 3 support staff), and temporal staff of 3 who are working on projects to implement BPM5. The average professional has high academic qualifications (economists and statisticians) and most of them have several years of experience and have participated in training in the area of the balance of payments (7 of the 12 professional staff have undergone BOP training courses offered by the IMF), some of them have participated in other training and meetings (e.g., Balance of Payments Statistics Committee of the IMF, European Union, Mercosur workshop on financial account and portfolio investment).

Staff also receives academic training. At present, a statistician is working towards a Diploma on Financial Economics and an economist is working towards a Master in Economics, both in Chilean universities. Another statistician is participating in a doctoral program on data analysis in a Spanish university.

The data collection and compilation procedures of the Balance of Payments Department are highly computerized. In addition, the Department uses computing applications to increase efficiency, most of which have been designed and implemented according to the specifications defined by the Department’s staff. The most used computing applications are the following:

(1) Introduced a direct line with the Customs Service to collect information on trade (export and imports of goods and services).

(2) Designed a database for “on-line analytical processing (OLAP)” to manage data on trade and supplementary information on services which facilitates cross section analysis.

(3) Designed a program to calculate commercial credits for import and export statistics, which are not included in the external debt statistics

(4) Implemented a database management program for information on direct investment.

(5) Uses the Internet to run surveys on direct investment.

0.2.2 Measures, if any, which exist for determining the cost-effectiveness of the BOP statistical work program.

Since 1999, budget formulations include cost-effectiveness analysis on each BCCH project/work program.

0.3 Quality awareness

0.3.1 Processes in place to focus on the quality of BOP statistics in accordance with changing users needs, emerging data requirements, etc.

The Information and Statistical Management Department (Gerencia de Información e Investigación Estadística) was created in December 2000, combining the Departments of the Balance of Payments and National Accounts. The reorganization highlights the increased importance of statistics for the BCCH.

There are several projects underway oriented towards improving the quality of BOP statistics, these include:

(1) The project to develop a statistical system for compiling international transactions data (Sistema Estadístico de Transacciones Internacionales (SET1)). This project was jointly developed by the Balance of Payments and the External Statistics Departments (July 1999-December 2000) to improve the coverage of the data on the capital account, associated income flows and international investment position prescribed by SDDS. Several SETI proposals will be implemented in 2001, which will enable Chile to meet the SDDS requirements to disseminate data on IIP by June 30, 2002. In April, 2001, existing regulations to capital flows were removed, but the requirement to provide data for statistical purposes remained, and were adjusted to take account of BPM5 requirements.

(2) Budgetary increases to finance the SERNATUR Agreement destined to meet BPM5 requirements.

(3) The project to develop statistics to compile the services account of the BOP to meet BPM5 requirements.

(4) The project to assure consistency between the balance of payments and national accounts data.

(5) Surveys on direct investment in Chile and abroad.

(6) Participated in the Coordinated Portfolio Investment Survey.

1. Integrity

1.1 Professionalism

1.1.1 Statistics are compiled on an impartial basis

The statutory provision under which the BCCH compiles balance of payments statistics is adequate to guarantee independence of the staff. The staff independently selects sources and methods. The BCCH enjoys high credibility due to the quality of the published data as well as for its tradition of independence.

1.1.2 Choices of sources and methods are informed solely by statistical considerations

Choices of sources and methods are based solely on statistical consideration. A summary of the methodologies used are published in the Chilean Balance of Payments, which is available in hard copy, CD and on the BCCH’s website. The public is informed of important methodological changes through footnotes, special articles, press releases, press conferences and/or meetings with professional groups. For example, when a new series of balance of payments, which included reinvested earnings data was first released, the BCCH organized a press conference and a meeting with specialists to discuss the changes, particularly that the inclusion of reinvested earnings increased the deficit in the balance of payments.