Official Statistics

Regional trade in goods statistics disaggregated by smaller geographical areas: explanatory notes 2022

Published 9 November 2023

Summary

HM Revenue & Customs (HMRC) is responsible for collecting the UK’s international trade in goods data, which are published as two National Statistics series - the ‘Overseas Trade in Goods Statistics (OTS)’ and the ‘Regional Trade in Goods Statistics (RTS)’. National Statistics are accredited officifal statistics. The RTS is published every three months (quarterly) showing trade at summary product and country level, split by UK regions and devolved administrations.

HMRC introduced the Regional Trade in Goods Statistics Disaggregated by Smaller Geographical Areas following requests from users for international trade in goods data at more detailed geographic levels. This is an annual official statistics in development publication that subdivide the existing Regional Trade in Goods Statistics (RTS) into smaller UK geographic areas. This release reports on international trade in goods at International Territorial Levels (ITL) 1, 2 and 3 for 2022, and includes Standard International Trade Classification (SITC) 1 and partner country breakdowns at the ITL 2 level.

Official statistics in development

Official statistics in development are official statistics that are undergoing further refinement. They were formerly known as “experimental statistics”. They may be new or existing statistics, and will be tested with users, in line with Code of Practice for Statistics standards covering:

• Trustworthiness
• Quality
• Value

To do this we use the same processes used in the production of the Regional Trade in Goods Statistics (RTS).Assessed in 2010, the RTS is an accredited official statistic that is published monthly.

Our data is derived from the high-quality datasets that underpin the OTS which undergo regular extensive validation procedures.

Regional Trade in Goods Statistics Disaggregated by Smaller Geographical Areas is compiled to serve the needs of many users, including:

• Governments
• Business community
• Compilers of other economic statistics
• Various regional and international organisations
• Researchers
• The public

These statistics are also used for:

• Press queries
• Parliamentary Questions
• Freedom of Information requests
• Other Government Departments who rely on HMRC’s data to inform evidence-based policies

After several years in consultation with users, these statistics remain in development. This is due to changes in data sources as a result of the UK’s exit from the EU. For 2023 data that will be published in 2024 we intend to remove the “official statistics in development” label and instead publish under the “official statistics” label.

Our statistical practice is regulated by the Office for Statistics Regulation (OSR). OSR sets the standards of trustworthiness, quality, and value in the Code of Practice for Statistics that all producers of official statistics should adhere to.

More information on how HMRC statistics reflect the standards of trustworthiness, quality and value in the Code of Practice for Statistics is available from the Overseas trade in goods statistics methodology and quality report.

You are welcome to contact us directly by emailing uktradeinfo@hmrc.gov.uk with any comments about how we meet these standards.

Alternatively, you can contact OSR by emailing regulation@statistics.gov.uk or via the OSR website.

More information can be seen on OSR’s information on Official Statistics in Development.

Tables in this release

The tables produced in this release are:

1. Summary of existing ITL1 RTS data
2. ITL2 by EU / Non-EU and import / export
3. ITL2 by EU / Non-EU, import / export and SITC Section (1-digit)
4. ITL2 by EU/Non-EU, import / export and Partner Country
5. ITL3 by EU / Non-EU and import / export

Definitions

Geography

Following the UK’s withdrawal from the EU, a new UK-managed international statistical geography - ITL (International Territorial Levels) - was introduced from 1st January 2021, replacing the former NUTS classification. They align with international standards, enabling comparability both over time and internationally. To ensure continued alignment, the ITL’s were established to mirror the NUTS system. More information on ITL can be found on the ONS website.

Partner country

This is the country the UK region exports the goods to or imports the goods from. Only the 99 pre-selected partner countries published in the RTS are included in this release. Data is available for a country if the country’s total trade (imports and exports combined) exceeds one per cent of the total trade of that country’s World Region (based on a historical baseline). This does not apply to EU countries where data for all member states is available.

In addition, if a specific partner country cannot be found under a certain breakdown it may be due to the following:

• The trade for that combination of variables is between 0 (i.e. no trade) and £499,999
• The trade has been suppressed under our statistical disclosure policy

Standard International Trade Classification (SITC) Section

This is a broad classification system which classifies goods into ten categories. It forms part of the hierarchical SITC managed and maintained by the EU.

Allocation of Trade to Geographical Areas

RTS data is compiled by merging trade data collected by HMRC with employment data from the Inter-Departmental Business Register (IDBR). A business’ trade is allocated to a region based on the proportion of its employees employed in that region.

We have replicated the employee allocation method for these statistics, so these figures will aggregate to the published RTS ITL1 figures. However, certain allocations used in the RTS e.g. Below Threshold Trade Allocations and Fixed Link Energy allocations are not disaggregated any further than ITL1.

Data source changes

UK to EU exports

Up to 31 December 2020, UK to EU export statistics were collected via the Intrastat statistical survey, which required traders to declare the value and volume of commodities exported to EU Member States within the relevant month of physical goods movement.

For goods moving from 1 January 2021, GB to EU export statistics are compiled directly from customs export declarations made according to the requirements of the Taxation (Cross Border Trade) Act. The customs declaration requirements are more complex than the single monthly aggregated Intrastat return and can result in differences between dates of declaration and actual movement of the goods out of the country.

The OTS compilation methodology relies upon the acceptance date of the customs export declaration for its inclusion within the relevant month of account, rather than the declared physical movement date used from the Intrastat survey.

Intrastat survey returns continue to be collected for goods exported from Northern Ireland to the EU, under the terms of the Northern Ireland Protocol.

Both the GB to EU customs export declaration data and Northern Ireland Intrastat export (dispatch) data are incorporated into the overall UK to EU export dataset.

As a result of the changes and differences outlined above, there is a break in the timeseries for published UK to EU export statistics from January 2021. Users are advised to note this change when making comparisons to previous quarters/years.

UK imports from EU

For UK imports from the EU, the Intrastat survey continued to operate in 2021 for all UK (GB and NI) imports (arrivals) from the EU, to mitigate the effects of staged customs controls, and to comply with the Northern Ireland Protocol.

However, from 1 January 2022, Intrastat only applied for movements of goods between Northern Ireland and the EU. Statistics on movements into GB from the EU have been compiled directly from customs import declarations.

Therefore, from January 2022, the UK’s goods imports from EU dataset incorporates two data sources: GB’s goods imports from EU data that is collected via customs declarations and NI’s goods imports from EU data, collected via Intrastat declarations.

As announced in the Borders Control Statement (UIN HLWS473) on 15 December 2021, the Government extended the current arrangements for moving goods from the island of Ireland to Great Britain for as long as discussions on the Protocol are ongoing.

These temporary arrangements enable Irish traders to continue relying on staged customs controls for the foreseeable future. While these measures are in place, import statistics for trade between GB and Ireland are reported as declared and may not reflect the period in which the goods have been traded.

Please note that customs import declarations of non-controlled goods imported into GB from Ireland can be deferred for up to 175 days. This may affect the accuracy of trade data for GB imports from Ireland and associated aggregations.

As a result of the changes and differences outlined, there was a break in the time series for published EU to UK import statistics from January 2022.

More information on the recent changes to trade in goods statistics can be found on the UK Trade Info website.

Statistical value threshold in Customs declarations

Customs declarations with commodity line values that fall under the statistical value threshold of £873 (in value) and 1,000kg (in net mass) are aggregated into ‘low value aggregates’. We do not receive business, product, or partner country information on these movements. As a result, we cannot assign this trade to a UK region, therefore the value is assigned to the Unallocated-unknown region.

This applies to goods exports from GB to EU countries from 2021, and imports to GB from EU countries from 2022. This is consistent with the RTS methods used for trade with non-EU countries, which are also sourced from customs declarations. As a result of this change, a value increase will be apparent for Unallocated-Unknown for EU flows from the dates specified.

Re-introduction of EU business counts

Due to the recent changes to data sources outlined, as well as changes to the VAT data source, a new method for EU business counts was introduced in the January to March 2022 publication, which resulted in a break in series from previous RTS EU business counts. EU and total business counts from the 2021 data period onwards are therefore not comparable with RTS business counts published prior to 2021.

Prior to 2021, EU business counts were compiled from Intrastat declarations, while businesses trading below the Intrastat threshold were captured through VAT data. Businesses trading below the Intrastat threshold made up a small percentage of the total trade value but accounted for most of the businesses trading.

From January 2021, changes were made to the VAT data which means that only movements between Northern Ireland and EU countries are accurately recorded. Further, following EU Exit, trade between GB and EU countries is now reported through customs declarations rather than Intrastat. Customs declarations therefore became the main data source for GB exports to EU countries from January 2021, and GB imports from EU countries from January 2022.

As a result of the changes outlined, a new time series for EU business counts begins from the data period of January to March 2021. EU business counts are now compiled in this way:

EU exporters from 2021 onwards:

• GB exports to EU countries via customs export declarations
• NI exports to EU countries via Intrastat (above threshold) and VAT data (below threshold)

EU importers for 2021:

• UK imports from EU countries were collected via Intrastat
• NI imports from EU countries for those below the Intrastat threshold collected via VAT data
• Additional raw customs import declaration data to better capture the GB imports from EU countries. Throughout 2021, businesses could defer their EU imports declarations for up to 175 days, this may impact data quality

EU importers for 2022:

• GB imports from EU countries via customs import declarations
• NI imports from EU countries via Intrastat (above threshold) and VAT data (below threshold)

Methodology

This release uses the same allocation methodology as the RTS which means that the main allocation method used for ITL1 in the RTS has been replicated for ITL2 and ITL3 in this release.

RTS data is compiled by merging trade data collected by HMRC with employment data from the Inter-Departmental Business Register (IDBR). A business’ trade is allocated to a region based on the proportion of its employees employed in that region. Where a trader is not matched with the IDBR, its trade is matched with Office for National Statistics postcode data to obtain the region in which the Head Office of the Economic Operators Registration and Identification (EORI) / VAT registered business (importer or exporter) is based.

Not all trade can be assigned to one of the 9 English Regions, Wales, Scotland and Northern Ireland. Where appropriate, this is referred to in the tables as the ‘Unallocated Trade’. Unallocated Trade is split into:

‘Unallocated – Known’: where we have virtually full details of the trade, but it is not appropriate to allocate it to a region. This covers:

• Trade going into or out of the Channel Islands or the Isle of Man
• Trade carried out by overseas based traders who have a VAT presence in the UK
• Trade carried out by the UK Government
• Parcel post trade that is dealt with centrally (trade collected via customs declarations)

‘Unallocated – Unknown’: This includes:

• Trade where business details submitted are invalid
• Un-registered businesses (trade collected via customs declarations)
• Private Individuals (trade collected via customs declarations)
• Low Value Trade (trade collected via customs declarations)

For specific energy goods only, trade is allocated to the region where the goods enter or leave the UK rather than the location / employment of the business doing the trade. This is because HMRC receives details of the trade in these goods directly from grid operators rather than the business. The goods concerned are Electrical energy, Natural Gas in a gaseous state and Crude Oil exported directly from offshore oil rigs. Crude Oil imported to the UK and exported from terminals is still allocated to the region of the business. Due to the information available we cannot provide this element at any geographical level below ITL1.

The business count is derived from trade declarations and is a count of businesses importing and exporting. Trade declared via Customs declarations will not include businesses whose trade is made up entirely of consignments below the statistical threshold (£873 and 1000kg).

Where businesses have branches in multiple regions a business will be counted as one in every region they have employees. This represents the actual count of businesses in any region. However, it will mean the sum of the trader count for each region will be greater than that for the UK. This is what is called the ‘Whole Number Method’ in the RTS.

This release is categorised by partner country and Standard International Trade Classification, Rev.4. (SITC) at section level (1-digit). The SITC is a relatively broad classification of goods and is not as detailed as the commodity classification available in the OTS.

More information on the RTS and this release can be found in the RTS methodology document.

Related statistics

Overseas Trade in Goods Statistics

Data is taken primarily from Customs systems (for UK imports from and exports to non-EU countries and GB imports from and exports to EU countries) and the Intrastat survey (for Northern Ireland imports from and exports to EU countries). HMRC does not receive information in respect of goods that move wholly within the UK, nor in intangibles and services such as banking or tourism.

The Overseas Trade in Goods Statistics (OTS) is published on a Special Trade basis, following changes to the methodology from May 2016 account onwards. The RTS is also published on this basis.

Trade in non-monetary gold (NMG) is included in OTS data, however this is excluded from RTS data, including this release. This is because the majority of NMG trade would be assigned to the London region and this would distort the RTS figures.

Balance of Payments

The Balance of Payments (BoP) figures published by the Office for National Statistics (ONS) are calculated on a different basis to the OTS. Therefore, adjustments are made when producing BoP which means that the RTS and BoP are not comparable. The ONS website provides an overview of BoP, and is where you can find their detailed monthly UK Trade Releases.

ONS subnational trade

The ONS produces the International trade in UK nations, regions and cities statistics which estimates the value of exports and imports of goods and services for 2021 for International Territory Levels 1, 2 and 3. The ONS release is produced on a BoP basis while RTS are compiled on an International Merchandise Trade Statistics (IMTS) basis. There are numerous different methodologies that contribute to the compilation of each set of statistics, but the main one is that RTS are compiled based on goods physically entering or leaving the UK, while the ONS subnational trade are produced on a change of economic ownership basis. Please note that the RTS disaggregated by smaller geographical area statistics exclude non-monetary gold.

Governance

Currently these statistics are labelled as official statistics in development.

The reasons for this are:

• to allow us to build in improvements to the methodology, data included, visuals, etc.
• to allow external users to provide feedback on the publication so that enhancements can be made to future releases
• changes in data sources as a result of the UK’s exit from the EU

For more information and guidance on the use of official statistics in development, please visit the (Guide to Official Statistics in Development) on the ONS website.

HMRC applies Statistical Disclosure Control (SDC) on all its statistical releases to protect our data providers. Therefore, requests for data relating to other geographies or greater detail are also subject to SDC so it is unlikely that these can be provided.

Now that the UK has left the EU, it is important that our statistics continue to be of high quality and are internationally comparable. All releases continue to be produced in accordance with the UK Statistics Authority’s Code of Practice for Statistics as well as internationally agreed statistical guidance and standards.

Statistical contact:
M Mastrangelo
e-mail uktradeinfo@hmrc.gov.uk

Next release: November 2024

If using specific facts contained in this release, please check the information is still current.