BALANCE OF PAYMENTS
PRESS RELEASE Release Date: November 20, 2008
BALANCE OF PAYMENTS
For the third quarter of 2008, the current account posted a surplus of US$2.01 billion and the financial account showed a net outflow of US$6.64 billion. The overall balance of payments registered a deficit of US$2.60 billion, reflecting a decrease in the Bank's reserve assets.
In terms of the current account, exports and imports reached the second highest and the highest quarterly figures, respectively. Exports grew by 7.7% in value from the same period of the previous year, bolstered by a steady increase in exports to neighboring Asian countries. Imports expanded by 20.0% year on year due to a substantial increase in imports of crude petroleum and other minerals, as well as iron and steel products. Goods trade recorded a surplus of US$1.51 billion, a large decrease of US$6.39 billion, or 80.9%, compared to the same period of the previous year. The services account deficit narrowed by US$0.87 billion over the same period last year to US$0.53 billion, mainly driven by a decrease in travel expenses and an increase in merchanting trade surplus. The surplus in the income account increased by US$0.74 billion from the same period last year to US$1.70 billion, mainly owing to a decrease in payments to non-residents' direct investment income. The current transfer deficit went down by US$0.32 billion from the same period last year to US$0.67 billion, mainly caused by an increase in the inward remittances to supplement family income.
In summary, despite the widening income account surplus and the narrowing services account and current transfer deficits, the significant decline in goods trade surplus still led the current account surplus to decrease by US$4.47 billion, or 69.0%, over the same period last year.
With regard to the financial account, both direct and portfolio investment showed net outflows with respective values of US$1.15 billion and US$11.06 billion. Residents' portfolio investment abroad turned into a net inflow of US$4.16 billion, the first net inflow since the fourth quarter of 1990, as residents liquidated their investment in foreign financial products amid the global financial turmoil. Non-residents' portfolio investment hit the largest quarterly net outflow on record at US$15.23 billion. This was primarily because foreign institutional investors slashed their holdings of local stocks and government bonds to inject funds into their parent companies or to meet redemption pressures from fund investors. Other investment exhibited a net inflow of US$5.45 billion, as the private sector withdrew overseas deposits and the banking sector brought in funds from their overseas branches.
For the first three quarters of this year, the current account showed a surplus of US$17.63 billion, the financial account exhibited a net outflow of US$4.67 billion, and the overall balance registered a surplus of US$13.31 billion, reflecting an increase in the Bank's reserve assets.
Notes: 1. The next balance of payments data will be released at 16:20 p.m. on February 20, 2009.
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.