Export Statistics Scotland: methodology

Information about the methodology used to produce the estimates of Scotland's exports in the Export Statistics Scotland publication.


How are exports defined in ESS?

We define exports as direct sales of goods or services to customers based outside Scotland. This includes sales to visitors to Scotland. The estimated value of goods excludes VAT, freight and insurance costs.  

Traditionally, exports are thought of as the international exporting of goods. However, we also provide an estimate of the value of services Scotland exports. Sales of services to customers not ordinarily based in Scotland are counted as service exports. An example of a service export would be financial and insurance services sold to international customers or customers in the rest of the UK.   

Scottish goods exported from ports in other regions of the UK are counted as Scottish exports. In ESS, we measure the destination of goods exported from Scotland regardless of the port from which they leave the UK. All data sources used in ESS focus on the destination of the product rather than where it leaves the UK.  For example, a sale by a Scottish business to a customer in Paris is counted as a Scottish export to France even if it leaves the UK from Dover.    

Sometimes Scottish goods are exported to the rest of the UK, and are then re-exported, including as part of other products. In this situation, the ESS figures capture the first export destination only. If a business exports a good to the rest of the UK, and this good is then exported somewhere else, ESS will only count the export to the rest of the UK. It is not possible to say exactly what proportion of Scotland’s exports are re-exported from the rest of the UK. However, over half of Scottish exports to the rest of the UK are services (such as financial services) and are therefore unlikely to be re-exported abroad. Also, many of the goods exported to the rest of the UK are in sectors where re-exporting is unlikely (utilities, retail and wholesale). 

The products of some Scottish businesses also feed into a global supply chain. For example, businesses may sell a good to a business in England. This business may incorporate it into a product which is exported internationally. In this situation, only the sale from the Scottish business to their customer in England is counted as a Scottish export.  For example, if a Scottish leather maker sells leather upholstery to a car company in England, which subsequently sells the completed car to China, Scotland’s export figures will only record the initial sale to the rest of the UK. 

All international exports of Scotch whisky are counted as Scottish exports. The data source for Scotland’s international whisky exports is the HMRC Overseas Trade Statistics, which cover the whole of the UK and do not allocate goods exports to a region. Scotch whisky exports to the rest of the UK are estimated from GCS responses. This is because His Majesty's Revenue and Customs (HMRC) do not collect information on trade within the UK.  

Rotterdam effect

The Netherlands is consistently reported as one of the top export destinations for Scotland. The Netherlands contains the port in Rotterdam, which acts as a major distribution hub as well as a port. This means that Rotterdam is often the destination of many goods exported from Scotland (and the rest of the UK). These goods are then re-exported to other destinations. This results in what is known as the  “Rotterdam Effect”, which is when the amount of exports to the Netherlands is artificially inflated. For example, chemicals and refined petroleum may be transported to the Netherlands initially and then subsequently transported elsewhere. ESS estimated export figures will only capture the exports from Scotland to the Netherlands. ESS figures for exports to the Netherlands may therefore be inflated. 

Oil and gas

Estimates of Scotland’s exports in ESS do not include the value of exports of oil and gas extracted from the UK continental shelf. This means that ESS excludes businesses classified as 'Extraction of crude petroleum' [SIC (2007) 6.1] and 'Extraction of natural gas' [SIC (2007) 6.2]. However, exports of services provided to the oil and gas industry are included under 'Support activities for petroleum and natural gas extraction' [SIC (2007) 9.1], 'Support activities for other mining and quarrying' [SIC (2007) 9.9] and 'Architectural and engineering activities; technical testing and analysis' [SIC (2007) 71]. For a full list of excluded SIC codes see the excluded industries table

Exports to the rest of the UK

Exports to the rest of the UK relate to trade from Scotland to England, Wales and Northern Ireland or to oil and gas businesses operating offshore, including in Scottish Adjacent Waters. As with international exports, it is possible that some exports to the rest of the UK are subsequently re-sold (or processed and then sold) by the initial buyer to an international destination. In such cases only the initial sale from Scotland is included as Scottish exports. This is different from Scottish exports that are exported internationally via a port in the rest of the UK, which are counted as Scottish international exports.  

It can be difficult to ascertain the final destinations of sales within the UK as businesses have no statutory requirement to collate financial information below UK level. 

In addition, users should note that in this publication and other Scottish Government statistics, estimates of exports to the rest of the UK include sales of goods and services by onshore based businesses to oil and gas extraction companies operating in Scottish Adjacent Waters. 

Contact

If you have any enquiries relating to these statistics then please contact the Trade Statistics team at:

Email: exports.statistics@gov.scot

Post:
Trade Statistics
5th Floor Atlantic Quay 5
150 Broomielaw
Glasgow
G2 8LU

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