Facebook Blogging

Edward Hugh has a lively and enjoyable Facebook community where he publishes frequent breaking news economics links and short updates. If you would like to receive these updates on a regular basis and join the debate please invite Edward as a friend by clicking the Facebook link at the top of the right sidebar.

Monday, September 8, 2008

Estonia GDP Q2 2008 Details

According to revised details released this week by the Estonian Statistics Office, gross domestic product (GDP) decreased by 1% in the 2nd quarter of 2008 when compared with the same period in the previous year. Statistics Estonia changed over to a chain-linking method for calculating real (constant price) economic growth in this quarter, so there have been some changes to the earlier time series data.

Compared to the 1st quarter, the GDP, chain-linked by the reference year 2000 and seasonally and working-day corrected, decreased by 0.8 %.

The decrease in the GDP was mostly influenced by the weak domestic demand and at the same time by the decrease in exports of goods and services. Compared to the same quarter of the previous year, total domestic demand was down by 2.8% primarily due to the decrease in private consumption and capital investments (-2.0% and -2.5%, respectively).

Private consumption decreased mainly due to the decrease in expenditures on transport and clothing and footwear. The growth of expenditures on food and non-alcoholic beverages decelerated. Capital investments decreased in both the financial and the household sector. Investments by manufacturing were almost stationary year on year. At the same time public sector construction investments accelerated.

The decrease in exports and imports since the second half of the previous year deepened in the 2nd quarter this year even more. Compared to the 2nd quarter of the previous year, exports of goods and services decreased by 4.9% and imports by 8.2% by chain-linking method.

Goods exports were down by 3.2% primarily due to the decrease in exports of refined petroleum products. At the same time, exports of basic metals and electrical machinery (electrical motors and appliances), which significantly influence export movements, increased. Exports of services decreased by 8.9% primarily due to the decrease in exports of services for railway cargo, airway passengers and cargo transport and trade related exports services. The decrease in imports of goods was influenced mainly by the decrease in imports of refined petroleum products and motor vehicles. While imports decreased faster than exports, the deficit of net exports in GDP has increased since the second half of 2007 and amounted to -4.6% of GDP in the 2nd quarter. In the 1st quarter the impact of net exports was -7.1% (so the negative impact slowed vis a vis Q1).

On the supply side the deceleration of the GDP was influenced mainly by the decrease in the value added in wholesale and retail trade, transport and storage, manufacturing and electricity, gas and water supply activities. The value added in financial intermediation activities also decreased.

The decrease in the value added in manufacturing was mainly caused by weak domestic demand and the resulting decrease in orders. A significant impact was the decrease in the value added in the manufacture of wood, furniture, building materials and food.

No comments: