BALANCE OF PAYMENTS
PRESS RELEASE Release Date: May 21, 2007
BALANCE OF PAYMENTS
For the first quarter of 2007, the current account registered a surplus of US$8.78 billion, the financial account recorded a net outflow of US$10.97 billion, and the overall balance registered a surplus of US$0.37 billion, reflecting an increase in the Bank's reserve assets.
In terms of the current account, exports grew by 8.6% over the same period last year mainly due to an increase in exports to neighboring Asian countries. Imports grew by 2.3%, led by an increase in imports of steel, iron, and other metals. Because the increase in exports outpaced imports, goods surplus increased by 82.8% over the same quarter last year to US$7.12 billion. The services account deficit widened by US$0.45 billion over the same quarter last year to US$1.44 billion, mainly caused by a decrease in merchanting trade surplus. Income surplus increased by US$0.36 billion to reach a historically high quarterly level of US$4.0 billion, mainly due to higher income earned from residents' foreign exchange assets and greater interest earnings from banks' offshore banking units (OBUs). Current transfer deficit decreased by US$0.15 billion from the year-ago level to US$0.9 billion. In sum, increases in goods and income surpluses, coupled with the decline in current transfer deficit, caused the current account surplus to increase by US$ 3.29 billion or 59.8% from the same quarter last year to US$8.78 billion, the second highest quarterly figure following the fourth quarter of 2005.
With regard to the financial account, direct investment and portfolio investment recorded net outflows of US$0.15 billion and US$11.82 billion, respectively. Direct investment abroad and foreign direct investment in Taiwan exhibited second highest quarterly levels after the second quarter of 1990 and the fourth quarter of 2006, respectively. Portfolio investment abroad by residents registered a net outflow of US$11.18 billion, the second highest figure after the second quarter of 2003. The outflow was mainly attributable to a sharp increase in residents' investment in foreign mutual funds and higher portfolio investment abroad by local insurance companies pursuing higher returns. Portfolio investment by non-residents recorded a net outflow of US$0.65 billion, mainly because foreign investors decreased their holdings of European convertible bonds (ECBs) issued by domestic companies. Financial derivatives registered a net outflow of US$0.44 billion. Other investment exhibited a net inflow of US$1.43 billion, primarily on account of the decrease in foreign currency deposits and the increase in short-term borrowings abroad by the private sector, and the increase in the Bank's repurchase agreement transactions aiming to enhance the returns from foreign exchange reserves management.
Tables & Graphs [ XLS ]
Notes: 1. The next balance of payments data will be released at 16:20 p.m. on August 20, 2007.
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.