Balance of Payments

1
Balance of Payments

• A set of accounts called the countrys Balance Of
  Payments (BOP) summarizes all the transactions by
  residents, firms and government of one country
  with their counterparts in the rest of the world

2
BOP Accounts

• Current Account
• Capital Account
• Official Settlements Account

3
Current Account

• Merchandise Trade
• Military Transactions
• Travel and Transportation
• Other Services
• Investment Income
• Unilateral Transfers

4
Capital Account

• Long-Term Capital Account
• a. Transactions in Real Assets
• b. Transactions in Financial Assets
• Short-Term Capital Account
• a. Short-Term Financial Assets
• b. Private Credits

5
Official Settlements Account

• Official Reserves
• a. Official Gold Reserves
• b. Official Foreign Exchange Holdings
• c. Reserve Position in the IMF and
• d. Special Drawing Rights (SDRs)
• Liabilities to Foreign Authorities