Jamaica News: Come September 2020, the Government will be amending the format for measuring Jamaica’s gross domestic product (GDP), to include research and development as a subsector.
Finance and the Public Service Minister, Dr. the Hon. Nigel Clarke, says this will entail incorporating the 2008 GDP measurement update under the United Nations System of National Accounts (SNA), being used by a number of countries, including the United States (US).
The SNA is the internationally agreed standard set of recommendations on how to compile economic activity measurements. The system is a coherent, consistent and integrated set of macro-economic accounts in the context of internationally agreed concepts, definitions, classifications and accounting rules.
Dr. Clarke, who was speaking at the opening of the University of the West Indies (UWI) Research Days 2019, on Wednesday (February 6), said research and development will initially be included in the annual GDP numbers, noting that “we are not at a point where we can feature it quarterly”.
“Eventually, we will have the quarterly numbers… but from September 2020, it will be the annual numbers. What will happen in September 2020 is that the previous years will be revised to take into account research activity over those years. This is a fundamental change,” he added.
The Minister noted that research was initially classified as an intermediate good in Jamaica and several other countries.
Dr. Clarke pointed out that following on the 2008 revision of the SNA, research was updated from an intermediate to a final product, thereby designating it a part of the GDP measurements.
“Since 2013… research and development expenditures in the United States have been incorporated into GDP and as a result of their large spending on research, their 2012 GDP was 3.6 per cent higher by virtue of the inclusion of research. Since that time, a lot of developed countries have applied this update and about 70 countries, so far, around the world have done it, but developing countries have struggled to incorporate it,” he pointed out.
According to UNESCO, about 10 countries around the world account for 80 per cent of global expenditure on research and development.
Additionally, as a part of the UN’s Sustainable Development Goals, countries have pledged to substantially increase public and private research and development spending by 2030.
The 20th staging of UWI Research Days will be held until Friday, February 8, 2019.
Source: JIS News