Chap03The Balance of Payments(国际财务管理,英文版).pptVIP

Chapter Three Outline Balance of Payments Accounting Balance of Payments Accounts The Current Account The Capital Account Statistical Discrepancy Official Reserves Account The Balance of Payments Identity Balance of Payments Trends in Major Countries Balance of Payments Accounting The Balance of Payments is the statistical record of a country’s international transactions over a certain period of time presented in the form of double-entry bookkeeping. N.B. when we say “a country’s balance of payments” we are referring to the transactions of its citizens and government. Balance of Payments Example Suppose that Maplewood Bicycle in Maplewood Missouri, USA imports $100,000 worth of bicycle frames from Mercian Bicycles in Darby England. There will exist a $100,000 credit recorded by Mercian that offsets a $100,000 debit at Maplewood’s bank account. This will lead to a rise in the supply of dollars and the demand for British pounds. Balance of Payments Accounts The balance of payments accounts are those that record all transactions between the residents of a country and residents of all foreign nations. They are composed of the following: The Current Account The Capital Account Statistical Discrepancy The Official Reserves Account The Current Account Includes all imports and exports of goods and services. Includes unilateral transfers of foreign aid. If the debits exceed the credits, then a country is running a trade deficit. The Capital Account The capital account measures the difference between U.S. sales of assets to foreigners and U.S. purchases of foreign assets. The U.S. enjoys about a $150,000,000,000 capital account surplus—absent of U.S. borrowing from foreigners, this “finances” our trade deficit. The capital account is composed of Foreign Direct Investment (FDI), portfolio investments and other investments. Statistical Discrepancy There’s going to be some omissions and misrecorded transactions—so we use a “plug” figure to get things to balance. Exhibit 3.1