BALANCE OF PAYMENTS
PRESS RELEASE Release Date: May 19, 2006
BALANCE OF PAYMENTS
For the first quarter of 2006, the current account registered a surplus of US$6.37 billion, the financial account recorded a net outflow of US$5.42 billion, and the Bank's reserve assets increased by US$2.24 billion.
In terms of the current account, exports grew by 11.4% over the same period last year with a quarterly value second only to the fourth quarter of 2005. The growth was mainly attributable to an increase in exports to neighboring Asian countries. Imports grew by 10.1%, led by imports of crude oil, chemicals and electronic parts. As exports increased by a larger value than imports, surplus on goods expanded by 30.2% over the corresponding quarter last year to US$3.69 billion. The services account deficit hit the lowest quarterly figure of US$0.07 billion, mainly caused by an increase in merchanting trade surplus and a decrease in payments to foreign sea carriers on imports. Income surplus rose by US$0.39 billion over the same quarter last year to US$3.80 billion, reaching the highest quarterly value on record. The increase was mainly due to higher income from foreign exchange assets and equity investments by residents and larger interest revenues earned by banks’ offshore banking units (OBUs). Current transfer deficit dropped by US$0.04 billion from the year-ago level to US$1.05 billion. In total, increases in goods and income surpluses, combined with decreases in services and current transfer deficits, pushed the current account to expand by US$1.96 billion or 44.5% from the same quarter last year to US$6.37 billion.
With regard to the financial account, direct investment and portfolio investment exhibited net outflows of US$0.19 billion and US$8.40 billion, respectively. Direct investment by non-residents showed the highest quarterly net inflow of US$1.65 billion, largely bolstered by the investment in Taishin Financial Holding Company by Newbridge Capital and Nomura Group. Portfolio investment abroad by residents posted a net outflow of US$11.99 billion, the second highest figure following the second quarter of 2003. This mainly resulted from a sharp increase in residents' investment in foreign securities through banks' earmarked trust funds and large portfolio investment abroad by local insurance companies and OBUs pursuing higher returns. Portfolio investment by non-residents recorded a net inflow of US$3.59 billion. Financial derivatives registered a net outflow of US$0.09 billion. Other investment exhibited a net inflow of US$3.26 billion, mainly due to a decrease in loans extended to and deposits made with foreign banks by the local banking sector.
Starting this year, the Department of Statistics of the Ministry of Finance has adopted the International Merchandise Trade Statistics: Compilers Manual, 2004 issued by the United Nations in its compilation of customs trade statistics. In compliance with this practice, the quarterly import and export data in balance of payments statistics have been modified since 1983. In addition, from this quarter on, balance of payments will follow the format proposed by the International Monetary Fund in Financial Derivatives: a Supplement to the Fifth Edition (1993) of the Balance of Payments Manual, 2002, which made financial derivatives, formerly classified as a subcategory of portfolio investment, a separate functional category under the financial account.
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Notes: 1. The next balance of payments data will be released at 16:20 p.m. on August 21, 2006.
2. For the release schedule for the next six months, please check the CBC website at http://www.cbc.gov.tw/EngHome/ESDDS/calacal.asp.