The State Statistical Committee of the Republic of Azerbaijan

SDDS of the IMF

Summary Methodology Price index: Producer prices

The Data: Coverage, Periodicity, and Timeliness

Coverage characteristics

Producer prices index of industrial products is calculated on the basis of a Laspeyres index (2005=100) covering whole Azerbaijan territory.
Producer Prices index of industrial products is calculated on the following sections of economic activity types (NACE classification) dividing: B "Mining and quarrying" C "Manufacturing", D "Electricity, gas, steam and conditioning supply", E "Water supply; sewerage, waste management and remediation activities" and bigger subclass, class, subgroups and groups. Producer Prices index of industrial products is prepared both economic activity type and kind of products. Producer Prices Index (PPI) based on economic activity type is indicated on the page of National Total Indicators.
Available PPI is being prepared on the basis of 472 enterprises' data covering 67% of present industrial production.
Prices data on 2018 item is collected monthly from 20 to 25 on each month. Current PPI is calculated on the basis of data represented by 472 enterprises and here includes surveyed 2018 product price (modification of 591 products). Data collected on prices reflects value indicator related to market selling of consumer and indicates the data about enterprises' operations which presenting report.
Weights are updated annually and are linked with one another by chain method between January and December of each year.
Aggregated weights of indices are reflected relative share in total production which got on the basis of annual survey of manufacturing enterprises. This survey covers 2785 enterprises.

Category/ Relative weight in index

Code Item Weight

06 Extraction of crude petroleum and natural gas 77,56

07 Mining of metal ores 0,002

08 Other mining and quarrying 0,14

09 Mining support service activities 1,46

10 Manufacture of food products 1,58

11 Manufacture of beverages 0,47

12 Manufacture of tobacco products 0,08

13 Manufacture of textiles 0,13

14 Manufacture of wearing apparel 0,07

15 Manufacture of leather and related products 0,06

16 Manufacture of wood and of products of wood and cork, except furniture; manufacture of articles of straw and plaiting materials 0,01

17 Manufacture of paper and paper products 0,03

18 Printing and reproduction of recorded media 0,11

19 Manufacture of coke and refined petroleum products 8,28

20 Manufacture of chemicals and chemical products 0,72

21 Manufacture of basic pharmaceutical products and pharmaceutical preparations 0,002

22 Manufacture of rubber and plastic products 0,17

23 Manufacture of other non-metallic mineral products 1,27

24 Manufacture of basic metals 1,22

25 Manufacture of fabricated metal products, except machinery and equipment 0,67

26 Manufacture of computer, electronic and optical products 0,15

27 Manufacture of electrical equipment 0,13

28 Manufacture of machinery and equipment n.e.c. 0,31

29 Manufacture of motor vehicles, trailers and semi-trailers 0,01

30 Manufacture of other transport equipment 0,07

31 Manufacture of furniture 0,1

32 Other manufacturing 0,02

33 Repair and installation of machinery and equipment 0,38

34 Electricity, gas, steam and air conditioning supply 4,46

35 Water collection, treatment and supply 0,3

No corrections made in products taking into account of seasonally factors.

Periodicity

Monthly

Timeliness

Calculate Statistics of PPI is permanently conducted during 4 month.

Access by the Public

Advance dissemination of release calendar The release calendar of data is indicated on the following webpage http://www.azstat.org/publications/indexen.php of SSC of Azerbaijan Republic.
Simultaneous release to all interested parties Data are released through press releases, through the regular State Statistical Committee's publications, and on the following webpage:http://www.azstat.org
1) Monthly bulletin "Dynamics and level of prices in Industry"
2) Annual Statistic Yearbook "Prices in Azerbaijan"
3) Monthly report of SSC "Socio-Economic Development"
Integrity

Dissemination of terms and conditions under which official statistics are produced, including those relating to the confidentiality of individually identifiable information
The State Statistical Committee (SSC) produces and disseminates data in accordance with the Law of the Azerbaijan Republic on Official Statistics (Resolution No. 790 of the Azerbaijan parliament Milli Majlis of February 18, 1994).
Article 1 of the Law provides the statutory basis for independently selecting sources and methods required to produce and disseminate CPI data.
Article 2 of this Law establishes the SSC as the main organization responsible for producing official statistics.
Article 5 holds the SSC responsible for:
(i) Disseminating statistical information of broad interest to the public;
(ii) guaranteeing the reliability and objectivity of statistical
information; and
(iii) assuring the accuracy, quality, and timeliness of the data produced.
Article 11 guarantees the confidentiality of the data reported to the SSC. Survey forms clearly state that reported data is subject to confidentiality under the Law.
The Law of the Azerbaijan Republic on Official Statistics is available in English on the following SSC webpage http://www.azstat.org/laws/indexen.php and in Azerbaijan language http://www.azstat.org/laws/indexaz.php.

Identification of internal government access to data before release Government officials don't have access to data before.
Identification of ministerial commentary on the occasion of statistical releases Statistics data is published not taking into account of other ministry's comments.
Accurate definition of indicators and presenting data related to major changes in methodology Data about PPI in appropriate publications is indicated as data to be reviewed.
Accurate definition period of indicators is equal to 1 year. Accurate defined indicators are indicated in publications.
The PPI index series are not revised. A notice is also provided in the event that data are revised.
The SSC is informed of major changes occurred in methodology, source of data and calculation methodology. Changes occurred in calculation methodology of CPI are set in the section of "Methodological explanations" of web page that belongs to SSC, in the monthly report named "Socio-economic Development", as well as other methodological publications. http://www.azstat.org/methodology/az/index.shtml
Quality

Dissemination of documentation on methodology and sources used in preparing statistics Brief information about methodologies is indicated following regular publications of SSC.
1) monthly bulletin "Dynamics and level of prices in Industry"
2)Annual Statistic Yearbook "Prices in Azerbaijan"
3) Monthly report of SSC "Socio-Economic Development"
Information on methodology and sources used to compile the PPI are available on request from the contact person.

I. Analytical Framework, Concepts, Definitions, and Classifications

Definition: Measure of overall change in the cost of a fixed set of goods recorded while quantity and quality became stabilize on all production units and subgroups.
Classification: 5 digit national version of NACE nomenclature is used while classifying of the enterprises by economic activity types, but while classifying of the goods, 10 digital extended version of PRODCOM nomenclature is used.

II. Scope of the data

Field coverage: PPI covers mining industry, processing and electricity production, including oil sector. Agriculture has been included since 1 January of 2003.
Product coverage: Products are covered on condition that total volume of the product output by available enterprise is not less than 70%. Then representative selection of products/ operations covering all economic activity types of these enterprises is realized. Even products/operations that not includes to the scope of 4 digit category are even selected according to the main activity of the enterprise. 2018 outlets on 591 varieties are observed in current sample. If the outputting product both exporting and putting into sale to internal market, then it is recorded as two product type taking into account of production volume in that previous year.
Geographical coverage: Whole country is covered.

III. Accounting Conventions

Timing of price observation: Prices on 2018 items are collected from 20 to 25 of each month. operation moment not depending on actual payment time.
Represented period in report: Prices are recorded at the operation moment not depending on actual payment time.
Types of prices: last selling prices are belonged to collected price data deducting of taxes for products. This data reflects the value indicators related to market sails of producers including operations of units that presenting report.
Grossing/netting procedures: Operations among the associated enterprises are recorded on the total base.

IV. Nature of the Basic Data Sources

Source of weights: weights for product indexes are based on selling of per product type in previous year, weights of indexes of economic activity types are based on total output volume, including change of reserves.
Timing of current weights:Basis weights are used while calculating of PPI for 2008.
Frequency of weight updates: Weights are updated annually and are linked with one another by chain method between January and December of each year. Survey indicators of enterprises which reflecting information about separate enterprises could be gotten during a year. This gives opportunity to update PPI in each year using weights structure that based on product value in 2 years before and price changes on December of previous year .For example, PPI 2010 is calculated based on revision of 2008 surveyed data by prices of December 2009
Item selection: An item is selected on the basis of widespread demand and its regular sale at a reference enterprise.
Selection of enterprises: Representative enterprises are selected on the basis of production volume of industrial enterprises by probability sampling method. Sampling is conducted on the basis of indicators of industry division of SSC and data about registration of enterprises. SSC conducts complex register that updating on the basis of official registration data of enterprises. Furthermore, list of separate enterprises is presented by Ministry of Tax. Quarterly survey of small enterprises is added to these surveys.
Selection of products/operations: A weight of a product output in available production group is represented as representative factor in selected products for registration.
Item/product specification: Detail level of item/product specification consists of 10 figures by extended 10 digital national product classification based on international 8-digital PRODCOM classification.
Sample size: Prices data on 2018 item is collected monthly from 20 to 25 on each month. Available PPI is being prepared on the basis of 472 enterprises' data which covering 67% of present industrial production.
Methods on collecting of price data: Collection of data on prices is mainly realized by the way of visiting in person or sending questionnaire by mail. Price registration is conducted on paper forms.

V. Compilation Practices

Computation of lowest level indices: Lowest level indexes are calculated as an individual index of every product including to the sample.(Price of product unit in reporting month is divided into price of product unit in previous month. Aggregation of individual index is realized on the basis of indicators of industry production of product in previous year.
Aggregation: A modified Laspeyres formula is used to calculate the indexes.
Aggregation structure Price indices of products are aggregated by fields.
Alignment of expenditure and base period: Weights are updated annually and are linked with one another by chain method between January and December of each year.
Linking reweighted index to historical index: The annual replacement of weights should not affect the quality of indices and their continuity. To this end, indices are linked with one another (between each December and January), and in this process they form sequential time series that have a fixed reference point as a base.
Reference period: 2005=100.

VI. Other Aspects

Treatment of missing prices: Temporarily missing prices are imputed replacing by prices of other products and all replaced commodity is included to scope every year. A broad range of commodity classifications ensures proper measurement of price changes.
Selection of replacement items: If a current variety is permanently unavailable, a new replacement variety is selected. The new transaction price cannot be compared directly to the old transaction price, and therefore the price for the new item during the period in which the old item was observed must be obtained, and the change in quality must be estimated as a value equal to the difference between said prices during this period (consolidation or mutual stratification procedure).
Adjustments for quality differences: No adjustments are made for quality differences.
Introducing new products: New products are not introduced to the structure until weights are updated
Seasonal items: Seasonal items registration is not conducted in Azerbaijan because intervals and selling of seasonal commodities are not characterized for industrial production of Republic.
Verification of prices: Producer prices indices and PPI is compared each-other and characterized by analogical propensity.
The goal of enterprises' survey is ensuring of full coverage. Data in report is verified with other collected data by SSC as much as possible. There is internal compliance between PPI on economic activity type and PPI on type of product, that's why there is no contradiction between their dynamics.
Verification of processing: Auto-control is realized on per enterprise during creation of database and change of weights annually and all value of production volumes selected for observation is compared. Existence of distinction is verified in all NACE categories and weight system in representative sample. After calculating of PPI in two types (on NACE and PRODCOM classifications) dynamics tables of indexes that being in all aggregation levels are examined. Inconsistence between fields and total indexes on product types is never more than 1%.
Seasonally adjusted indices: PPI data are not seasonally adjusted.

Integrity
Advance dissemination of release calendar	The release calendar of data is indicated on the following webpage http://www.azstat.org/publications/indexen.php of SSC of Azerbaijan Republic.
Simultaneous release to all interested parties	Data are released through press releases, through the regular State Statistical Committee's publications, and on the following webpage:http://www.azstat.org 1) Monthly bulletin "Dynamics and level of prices in Industry" 2) Annual Statistic Yearbook "Prices in Azerbaijan" 3) Monthly report of SSC "Socio-Economic Development"
Dissemination of terms and conditions under which official statistics are produced, including those relating to the confidentiality of individually identifiable information	The State Statistical Committee (SSC) produces and disseminates data in accordance with the Law of the Azerbaijan Republic on Official Statistics (Resolution No. 790 of the Azerbaijan parliament Milli Majlis of February 18, 1994). Article 1 of the Law provides the statutory basis for independently selecting sources and methods required to produce and disseminate CPI data. Article 2 of this Law establishes the SSC as the main organization responsible for producing official statistics. Article 5 holds the SSC responsible for: (i) Disseminating statistical information of broad interest to the public; (ii) guaranteeing the reliability and objectivity of statistical information; and (iii) assuring the accuracy, quality, and timeliness of the data produced. Article 11 guarantees the confidentiality of the data reported to the SSC. Survey forms clearly state that reported data is subject to confidentiality under the Law. The Law of the Azerbaijan Republic on Official Statistics is available in English on the following SSC webpage http://www.azstat.org/laws/indexen.php and in Azerbaijan language http://www.azstat.org/laws/indexaz.php.
Identification of internal government access to data before release	Government officials don't have access to data before.
Identification of ministerial commentary on the occasion of statistical releases	Statistics data is published not taking into account of other ministry's comments.
Accurate definition of indicators and presenting data related to major changes in methodology	Data about PPI in appropriate publications is indicated as data to be reviewed. Accurate definition period of indicators is equal to 1 year. Accurate defined indicators are indicated in publications. The PPI index series are not revised. A notice is also provided in the event that data are revised. The SSC is informed of major changes occurred in methodology, source of data and calculation methodology. Changes occurred in calculation methodology of CPI are set in the section of "Methodological explanations" of web page that belongs to SSC, in the monthly report named "Socio-economic Development", as well as other methodological publications. http://www.azstat.org/methodology/az/index.shtml
Quality
Dissemination of documentation on methodology and sources used in preparing statistics	Brief information about methodologies is indicated following regular publications of SSC. 1) monthly bulletin "Dynamics and level of prices in Industry" 2)Annual Statistic Yearbook "Prices in Azerbaijan" 3) Monthly report of SSC "Socio-Economic Development" Information on methodology and sources used to compile the PPI are available on request from the contact person.