GDP CALCULATION FOR 2001 DONE BY MONSTAT
CONFIRMATION OF ISSP ESTIMATION MADE IN SEPTEMBER 2002
The Institute for Strategic Studies and Prognoses (ISSP) in September 2002 made an estimation of Gross Domestic Product (GDP) in Montenegro for 2001.
The Estimation was done by the expenditure method and according to the international statistical standards (SNA 93 and ESA 95). The ISSP estimation is the first estimation of GDP according to the international standards done in Montenegro.
GDP estimation is calculated in two versions:
1. Value of GDP that did not include value added in the informal sector (gray economy).
In this version, the estimated value of GDP, for 2001 is 1.048 billion Euro or 1,584 Euro per capita.
After the presentation of the estimation to Montenegrin Government Officials and institutions, this version is accepted as more relevant for the needs of fiscal policy and analysis. According to the SNA concept the value created in the informal sector is a component of GDP. However, this solution of GDP estimation is accepted as a more reliable base for the estimation of budget revenues.
2. Value of GDP that includes the added value created in the informal sector (gray economy).
In this version the GDP is 1.318 billion € or 1,990 € per capita.
GDP estimation is calculated based on the results of the household’s income and expenditures survey (ISSP), and based on the data from the Statistical Office of Montenegro (investment), Ministry of Finance (budget spending) and Central Bank of Montenegro (foreign- trade exchange).
Fourteen months after the estimation done by ISSP, Monstat (Agency for Statistics of Montenegro) made a calculation of Gross Domestic Product (GDP) using the same methodology but income concept, and published the GDP of 1.244 billion € in 2001 (1,880 € per capita). This GDP figure partially includes the value added in the informal sector (gray economy) but not all value added created in the informal sector.
Monstat announced that GDP calculation according to the expenditure method would be done in the future because they evaluated this method as more complicated. (We are emphasizing that ISSP estimation as done according to the expenditure method).
If we compare the GDP figure published by Monstat and GDP figure estimated by ISSP (the one that includes the value added in the informal sector), we see that ISSP estimation is 5.9% higher than the Monstat figure. The 5.9% difference can be implied to the standard omission which is characteristic of all estimated figures and that range from 3%-10%. However, it is more possible that this 5.9% difference is a value added in the informal sector that is not calculated in the Monstat GDP figure.
On the example of GDP we can conclude the following:
1. Expert estimations of macroeconomic aggregates are needed and are very important in Montenegro, because they realistically picture the economy, and on the other side they mollify the problem of lack of information in the situation of a non-developed statistical system in Montenegro. In addition, as the estimations are done far before the official calculations, they mollify the problem of non-accuracy of statistical agencies.
2. Monstat (Agency for Statistics of Montenegro) shows that it has the potential and possibility to contribute to the development of the statistical system in Montenegro.
