Economy-wide material flow accounts: documentation of statistics

Data description (SIMS 3.1)

Economy-wide material flow accounts describe in units of mass (tonnes) the volume of materials extracted, transferred or transformed from nature. This volume of materials and its ratio to other National Accounts aggregates describes the material dependency of the national economy and the pressures economic activities impose on the environment. The main interest lies in the development of the ratio between GDP and the volume of materials required to generate it. Economy-wide material flow accounts sum up the flows of used materials, such as stone, oil and wood. However, due to the summing up, the total figures of the material flow accounts do not describe direct the weight and nature of the environmental burden caused by economic transactions. The economy-wide material flow accounts form part of environmental accounts. The ultimate goal of environmental accounts is to describe the interaction between the environment and the economy by mainly using the same basic concepts and classifications as National Accounts. The European Union's regulation concerning environmental accounts (No. 691/2011) obliges the Member States to compile an annual report on their economy-wide material flow accounts; for the first time in 2013 and starting from statistical reference year 2008. In the UN's System of Environmental-Economic Accounts (SEEA) the accounts form part of the description of physical flows in the national economy.

Concepts and definitions (SIMS 3.4)

Direct material input (DMI)

Direct material input (DMI) includes materials extracted from Finland and materials imported to Finland from abroad. DMI = DE + IMP

Domestic extraction (DE)

Domestic extraction (DE) refers to materials extracted from domestic nature for further processing in the economy. They can be divided into biomass, metal ores, non-metallic minerals and fossil energy materials.

Domestic hidden flows / Unused domestic extraction

Domestic hidden flows / Unused domestic extraction refer to moves and transformations of natural materials that are made in connection with their extraction from nature or construction. Examples of these would be logging waste left in forests, and unused wall rock of ore mines. Hidden flows are included in total material requirement.

Domestic material consumption (DMC)

Domestic material consumption (DMC) takes into account not only direct domestic inputs, i.e. materials extracted from domestic nature, but also materials imported from abroad as raw materials or processed products and those exported abroad. DMC is one of the UN sustainable development indicators. DMC = DE + IMP – EXP

Domestic raw material consumption (RMC)

Domestic raw material consumption (RMC) measures the domestic final use of raw materials including domestic and imported raw material equivalents. It is calculated by adding imported raw materials to domestic direct inputs and, respectively, by subtracting the raw material equivalents of exported raw materials and processed products, i.e. the inputs required in the country to produce the imported or exported volume of materials. It is a more accurate description of burdens on the environment than domestic material consumption and also a more sensible indicator for comparisons between countries. RMC = DE + IMPrme – EXPrme

Economy-wide material flow accounts (EW-MFA)

Economy-wide material flow accounts describe the volumes of materials extracted, transferred or transformed from domestic nature, raw materials and processed products imported from abroad, and exports of raw materials and processed products. The statistics describe all solid, gaseous and liquid materials with the exception of air and water. The statistics are consistent with the Economy-Wide Material Flow Accounting (EW-MFA) framework outlined in the EU Regulation on environmental accounting and in the UN Handbook on Integrated Environmental and Economic Accounting.

Exports (EXP)

Exports (EXP) comprise of raw materials and processed products exported abroad.

Hidden flows of imports

Hidden flows of imports are comprised of the direct inputs and hidden flows which are used abroad to produce imported goods, but which do not show in the weight of imported raw materials or products. Hidden flows of imports are usually calculated with coefficients specific for each raw material or product group.

Imports (IMP)

Imports (IMP) consist of foreign imports of manufactured products and raw materials.

Material intensity

Material intensity describes the national economy's dependency on natural resources. It can be measured as the ratio of total material requirement, domestic material consumption or direct inputs to GDP. As material intensity decreases, the aim is to reach a situation where the state of the environment does not deteriorate as the economy grows. This is also known as decoupling of economic growth and environmental impacts. Domestic material consumption in relation to GDP is one of the sustainable development indicators (SDG). = DMC/GDP

Physical trade balance (PTB)

The physical trade balance (PTB) is calculated as the difference between imports and exports of processed products and raw materials. PTB = IMP-EXP

Raw material equivalents (RME)

In addition to the exported or imported volume of materials, raw material equivalents (RME) include the direct inputs required to produce the exported or imported volume of materials.

Raw material input (RMI)

Raw material input (RMI) is calculated by adding imported raw materials and processed products to domestic direct inputs, and the inputs needed to produce the imported volume of materials are also considered in the calculation. RMI = DE + IMPrme

Resource productivity (RP)

Resource productivity (RP) is calculated as the ratio between gross domestic product and domestic material consumption. It shows how efficiently natural resources are utilised in relation to GDP. Resource productivity is one of the EU's sustainable development indicators. RP = BKT/DMC

System of Integrated Environmental and Economic Accounting (SEEA)

The System of Integrated Environmental and Economic Accounting (SEEA) is a systematic description of the relationship between the environment and the economy. The accounts comprise of accounts and balances that describe the use volumes of natural resources, the loading caused by the use of natural resources, and the economy and business activity of environmental protection. The statistics of the System of Integrated Environmental and Economic Accounting are compiled in the framework of national accounts in compliance with their key characteristics, such as the industrial classification and the classification of sectors and the domicile principle of economic units.

Total material requirement (TMR)

Total material requirement (TMR) is the sum of domestic and foreign direct inputs and hidden flows. TMR = DE + domestic hidden flows + IMP + hidden flows of imports

Institutional mandate (SIMS 6)

Quality assurance (SIMS 11.1)

Release calendar (SIMS 8.1)

User access (SIMS 8.3)

Confidentiality - policy (SIMS 7.1)