Malawi : Technical Assistance Report on the Price Statistics Mission

EXECUTIVE SUMMARY ? In response to a request from the Malawi authorities and in consultation with the African Department (AFR), I undertook a technical assistance (TA) mission to Zomba during the period September 16–27, 2013 to assist with improving prices statistics, including the full conversion to direct pricing for the import and export price indexes (MXPI) and reviewing the new producer price index (PPI). This activity (14STJ6300) was funded by the East Africa Technical Assistance Center (East AFRITAC)1 and undertaken within the context of the following project: Price Statistics STA_MWI_2008_05. ? Important aspects for the mission to address included the following: (i) review the work undertaken to date on developing experimental unit value based MXPI; (ii) prepare detailed plans for the development of quarterly import and export price surveys; (iii) develop the methodology for the replacement of the unit values with survey-based prices in the index compilation systems; (iv) review the new PPI and consider any possible future enhancements; (v) provide training to staff on data collection and index compilation; and (vi) document the methodology and computational procedures developed during the mission. ? In order to make as much progress as possible in relation to all the phases of the index construction during the period of the mission, the focus was placed on the development of an import price index (MPI). The documentation relates to an MPI but the Malawi National Statistics Office (MNSO) will be well positioned to apply the same techniques, principles and procedures to develop an export price index (XPI). The development of the XPI will be more straightforward; experience has shown that the development and maintenance of an MPI is much more complex. ? The MNSO proceeded to follow the work program developed during the previous mission to initially compile experimental, unit value-based indexes then progressively replace the unit value price indicators with direct survey-based prices. ? However, MNSO could not proceed to compile the MPI because of problems with the credibility of the unit values. This follow-up mission undertook an analysis of the sample of import unit values by country selected for the MPI and found major problems with most of the basic data, particularly in relation to the reported quantities and units of quantity. Therefore, it is not feasible to proceed to compile the indexes until quarterly transaction prices are available fro ...