Nasty statistical manipulation

Trade’s very important we’re told:

When exports account for 30% of Britain’s GDP

No, that’s not right.

Exports have a value equivalent to 30% – ish of GDP, that’s true. But that’s not the same as “account“.

United Kingdom had a total export of 468,322,416.15 in thousands of US$ and total imports of 692,494,170.35 in thousands of US$ leading to a negative trade balance of -224,171,754.21 in thousands of US$ The Effectively Applied Tariff Weighted Average (customs duty) for United Kingdom is 1.72% and the Most Favored Nation (MFN) Weighted Average tariff is 2.68%.The trade growth is -2.97% compared to a world growth of -1.13%. GDP of United Kingdom is 2,829,110,000,000 in current US$. United Kingdom services export is 403,646,000,000 in BoP, current US$ and services import is 271,398,000,000 in Bop, current US$.United Kingdom exports of goods and services as percentage of GDP is 31.60% and imports of goods and services as percentage of GDP is 32.69%.

There’s the 30% -ish.

But the GDP equation is C + I + G + (X-M).

It is net exports which make it into GDP. The trade surplus, or in our case, deficit.

Another way to approach the same point. GDP is not turnover, it’s value added. But the exports figure is turnover, not value added.

We can even go further. Some of those exports are made from value added to imported goods. So, the addition to the UK economy, in terms of value added or created, is the net value added to those imports, right? Not the raw turnover figure for goods and services sent abroad.

UK exports amount to a number equal to 30% (-ish) of UK GDP. Exports do not account for 30% of UK GDP.

3 thoughts on “Nasty statistical manipulation”

  1. Much more than 30%, I think? Given that such an insane drop would affect all the economic activities surrounding/supporting those exports somewhat harshly as well.
    And quite a lot of export is connected to import ( steel into Stuff. UK doesn’t make enough steel to support itself.. for instance), so import would take a hit as well.

    All other things being equal simply doesn’t work. It’s all a spiderweb of interconnected rubber bands. Pull hard in one place and the whole thing moves, often in places you don’t expect.

  2. It is sad that Liz Truss MP, negotiator of many trade agreements, is held in so high regard by the Conservative Party membership. I like her a lot but the UK would be in a marginally better place if she was actively schit at her job. Trade deals with specific countries having a tiny negative effect on prosperity compared to the most obvious alternative.

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