THE BALANCE OF PAYMENTS - Bank of Jamaica€¦ · THE BALANCE OF PAYMENTS . Preliminary . QUARTERLY...
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1 Preliminary QUARTERLY REPORT March 2016 International Accounts Unit Economic Information & Publications Department RESEARCH AND ECONOMIC PROGRAMMING DIVISION THE BALANCE OF PAYMENTS
Transcript of THE BALANCE OF PAYMENTS - Bank of Jamaica€¦ · THE BALANCE OF PAYMENTS . Preliminary . QUARTERLY...
1
Preliminary QUARTERLY REPORT
March 2016
International Accounts Unit Economic Information & Publications Department
RESEARCH AND ECONOMIC PROGRAMMING DIVISION
THE BALANCE OF
PAYMENTS
2
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THE BALANCE OF PAYMENTS
Preliminary QUARTERLY REPORT
March 2016
International Accounts Unit
Economic Information & Publications Department
RESEARCH AND ECONOMIC PROGRAMMING DIVISION
BANK OF JAMAICA
P.O. BOX 621
Kingston, Jamaica
I S S N 0 7 9 9 3 2 9 3
Copyright © 2016 Bank of Jamaica Nethersole Place P.O. Box 621 Kingston, Jamaica, W.I. All rights reserved The material in this publication is copyrighted. Copying and/or transmitting portions or all of this work without permission may be a violation of applicable law. The Bank of Jamaica encourages dissemination of its work and will normally grant permission promptly to reproduce portions of the work. For permission to photocopy or reprint any part of this work, please send a request to Economic Information and Publications Department, Bank of Jamaica, Nethersole Place, P.O. Box 621, Kingston, Jamaica, Telephone: (876) 922-0750-9, Fax: (876) 967-4265, Email: [email protected].
ISSN 0799-3293
Printed in Jamaica
1
TABLE OF CONTENTS
Page
Balance of Payments
Quarter Review: January to March 2016 3
Fiscal Year Review: April to March FY 2015/16 7
Glossary (BPM6) 11
Appendix:
A. Comparison of BOP Formats 14
B. Historical Balance of Payments Tables 15
2
Table 1: Review Quarter
Balance of Payments (US$MN) 2015:Q1 2016:Q1
Jan-Mar Jan-Mar/ Change
Current Account Balance -20.2 116.3 136.5Credits 1,846.8 1,861.7 14.9
Debits 1,867.1 1,745.5 -121.6
Goods & Services -441.6 -283.1 158.5
Exports 1,191.4 1,183.8 -7.5
Imports 1,633.0 1,466.9 -166.1
Goods -772.3 -680.8 91.5
Exports 336.5 267.0 -69.4
Imports 1,108.7 947.8 -160.9
Services 330.6 397.7 67.0
Exports 854.9 916.8 61.9
Imports 524.3 519.1 -5.2
Primary Income -114.3 -158.4 -44.1
Credits 61.7 58.2 -3.6
Debits 176.0 216.6 40.5
Secondary Income 535.7 557.8 22.1
Credits 593.7 619.7 26.0
Debits 58.0 62.0 4.0
Capital Account 9.3 0.1 -9.2Credits 9.3 0.1 -9.2
Debits 0.0 0.0 0.0
Net lending (+) / net borrowing (-) (balance from current and
capital account) -11.0 116.3 127.3
Financial Account
Net lending (+) / net borrowing (-) (balance from financial account) -146.1 -71.8 74.3
Direct Investment -221.5 -236.4 -14.9
Net acquisition of financial assets -1.0 -0.1 0.9
Net incurrence of liabilities 220.6 236.3 15.7
Portfolio Investments 266.3 426.0 159.7
Net acquisition of financial assets 403.0 230.0 -173.0
Net incurrence of liabilities 136.7 -196.1 -332.8
Financial derivatives -2.0 -11.4 -9.4
Net acquisition of financial assets -12.2 -14.9 -2.7
Net incurrence of liabilities -10.1 -3.5 6.6
Other Investments -404.7 -191.6 213.0
Net acquisition of financial assets -269.1 -92.4 176.7
Net incurrence of liabilities 135.5 99.2 -36.3
Reserve Assets 215.9 -58.3
Net Errors and Omissions -135.1 -188.1
1/ Provisional
International Accounts Unit
Economic Information & Publications Dept.
August 2016
For more information on the terminologies of the above Balance of Payment Manual 6th edition
(BPM6) presentation format, please refer to the Glossary and Appendix A of this publication.
3
I. QUARTER REVIEW: January-March 2016
Jamaica recorded a preliminary current account surplus of US$116.3 million (or 0.8 per cent of GDP)
for the January to March 2016 quarter, relative to a small deficit of US$20.2 million for the similar period
in 2015 (Figure 1). This estimated outturn represents a US$136.5 million improvement in the current
account balance and the most favourable current account balance for a March quarter since 1995, when a
surplus of US$85.9 million was recorded. The outturn for the review quarter reinforces the upward trend
seen since the corresponding quarter in 2014 (Figure 1). The improved current account balance for the
review period stemmed from all sub-accounts except the primary income sub-account (Figure 2).
-800.3
-1072.3
-741.3 -697.7 -850.7
-943.2 -983.7 -884.5
-772.3 -680.8
163.8 216.9 265.5 310.7 285.3 254.6 276.7 248.3 330.6 397.7
470.9 517.0 427.6
469.0 484.4 504.9 502.6 542.0 535.7
557.8
-150.0
-173.8
-167.4 -115.3
-104.8 -21.6
-77.4
-62.1 -114.3
-158.4
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
Figure 2: BOP Sub-Accounts
January to March Quarters
Q1-2007 to Q1-2016
US$ Million
Goods Services Secondary Income Primary Income
-3.3-21.2
-56.6-16.0
3.026.8 20.8
51.785.9
35.156.1
-25.2
55.8
-32.0 -161.8-157.7
-245.2
1.4
-166.7
-278.8-315.7
-512.2
-215.7
-33.3-185.7
-205.2
-281.9
-156.3
-20.2
116.3
'87 '88 '89 '90 '91 '92 '93 '94 '95 '96 '97 '98 '99 '00 '01 '02 '03 '04 '05 '06 '07 '08 '09 '10 '11 '12 '13 '14 '15 '16
Figure 1: Current Account Balance January to March Quarters
Q1-1987 to Q1-2016US$ Millions
4
Goods The Goods sub-account improved by US$91.5 million to US$680.8 million largely reflecting a decline
in imports by US$160.9 million relative to the previous March quarter, the impact of which was partially
offset by a reduction in exports by US$69.4 million. The reduction in payments for imports of goods
largely reflected lower expenditure on mineral fuel, a fall of US$130.5 million or 40.9 per cent. Other
declining imports included chemicals, manufactured goods and miscellaneous commodities, falling on
average by US$21.8 million (Figure 3). This was partially offset by higher imports of capital goods and
intermediate food materials. The decline in exports of goods mainly reflected lower earnings from crude
materials, particularly mining exports down by 20.1 per cent and food exports by US$13.4 million.
Figure 3: Change in Value of Goods Imports and Exports by SITC January to March 2016 (y/y)
US$ Millions
Services
The increased surplus on the services sub-account by
US$67.0 million to US$397.7 million, relative to the
comparable period last year, was largely driven by travel
flows of US$687.4 million (Figure 4), which grew by 7.0
per cent. This growth in travel flows stemmed from a 3.2
per cent increase in stop-over visitor arrivals as well as
increases in visitors’ average length of stay and average
daily expenditure by 1.5 per cent and 1.4 per cent,
respectively. This was also supported by an improvement
in other services flows by 15.2 per cent, particularly
foreign direct investment related construction services
and ICT services including business process outsourcing
(Table 2).
Source: STATIN
580.5 576.3 595.0 642.3
687.4
-164.4 -187.0 -200.6 -139.7 -144.7
-161.4 -112.6 -146.0
-171.9 -145.0
2012 2013 2014 2015 2016
Figure 4: Services ComponentsJanuary to March Quarters
Q1-2012 to Q1-2016US$ Millions
Travel Transportation Other Services
5
Primary & Secondary Income
The secondary income balance improved by
US$22.1 million to US$557.8 million reflecting
higher official grants supported by a small increase in
remittance inflows by 1.7 per cent. On the other
hand, the deficit on primary income sub-account
worsened by US$44.1 million, primarily reflecting
increased interest payments to non-residents on
GOJ Global bonds by 32.9 per cent relative to
March 2014 as well as significant repatriation of
profits by foreign firms, up by 59.0 per cent.
The balance on the current account combined with
a small surplus of US$0.1 million on the capital
account for the review quarter totalled a net lending
balance of US$116.3 million, compared to a net
borrowing balance of US$11.0 million in the
corresponding quarter of 2015.
Financial Account
The financial account recorded a net borrowing
balance of US$71.8 million for the review quarter.
This was mainly comprised of a net build-up of
US$236.3 million and US$191.6 million in direct
investment and other investments liabilities,
respectively. This was coupled with a net
deleveraging of loan assets and currency and deposits
assets of US$20.3 million and US$72.6 million.
This was partially offset by reductions in non-
resident holdings of portfolio investment liabilities by
US$196.1 million along with a US$230.0 million
gain in resident holdings of portfolio investment
assets abroad (Figure 15).
466.6 460.7 492.6 501.3 506.6
38.3 41.9
49.4 34.4 51.2
-28.0 -78.5 -68.3
-125.0 -163.2
2012 2013 2014 2015 2016
Figure 5: Primary & Seconary Income Components
January to March QuartersQ1-2012 to Q1-2016
US$ Millions
Other Sector Transfers Compensation of Employees
Official Transfers Investment Income
-71.8
4,000
3,000
2,000
1,000
0
1,000
2,000
3,000
Figure 15: Financial Account Components Net flows in US$ Millions
Reserve Assets Other investment
Financial Derivatives Portfolio investment
Direct investment Financial Account
Lendin
g (
outf
low
s)
Borr
ow
ing (
inflow
s)
6
Consequently, the Bank’s gross reserves increased by US$166.0 million to US$2 894.3 million at end-
March 2016, representing 23.5 weeks of projected goods and services imports. (Table 2).
Table 2: Quarterly Summary by Fiscal Year
BALANCE OF PAYMENTS OF JAMAICA: SUMMARYFY
2013/14 2014Q2 2014Q3 2014Q4 2015Q1FY
2014/15 2015Q2 2015Q3 2015Q4 2016Q1FY
2015/16Current account -1231.3 -306.6 -323.1 -328.3 -20.2 -978.2 -117.6 -177.6 -80.0 116.3 -258.9Goods and services -3110.3 -756.9 -823.1 -835.3 -441.6 -2856.9 -575.3 -641.6 -594.2 -283.1 -2094.1
Goods -3778.4 -939.8 -946.0 -988.7 -772.3 -3646.8 -822.2 -797.6 -761.1 -680.8 -3061.8Exports 1495.3 355.9 375.0 333.5 336.5 1400.8 344.4 286.7 293.6 267.0 1191.7
Imports 5273.8 1295.7 1321.0 1322.2 1108.7 5047.6 1166.6 1084.3 1054.7 947.8 4253.4
Services 668.2 182.9 122.9 153.4 330.6 789.9 247.0 156.1 167.0 397.7 967.7Transport -702.5 -163.6 -168.5 -163.3 -139.7 -635.1 -146.0 -141.3 -143.8 -144.7 -575.9
Travel 1914.5 504.4 458.0 499.9 642.3 2104.7 529.3 488.8 505.6 687.4 2211.1
Construction -60.9 -13.7 -15.4 -15.1 -19.2 -63.5 -19.4 -30.4 -22.5 -8.7 -81.1
Insurance and pension services -126.0 -47.5 -51.5 -49.8 -33.0 -181.8 -13.0 -55.2 -48.2 -26.3 -142.6
Financial services -26.8 -6.7 -7.4 -7.2 -7.8 -29.1 -7.7 -7.7 -7.6 -7.7 -30.7
Charges for the use of intellectual property n.i.e. -50.3 -10.9 -11.6 -12.5 -9.6 -44.7 -11.0 -11.6 -13.0 -9.5 -45.1
Telecommunications, computer, and information services 64.7 11.0 15.1 -3.8 19.6 41.9 11.0 15.1 -3.8 24.8 47.0
Other business services -384.8 -101.0 -99.3 -99.8 -135.1 -435.1 -107.1 -105.3 -104.5 -130.7 -447.6
Personal, cultural, and recreational services 72.0 18.8 11.1 12.2 20.6 62.7 18.8 11.1 12.2 20.6 62.7
Government goods and services n.i.e. -31.7 -7.7 -7.5 -7.4 -7.5 -30.1 -7.9 -7.4 -7.4 -7.5 -30.2
Primary income -318.3 -97.0 -70.0 -69.2 -114.3 -350.5 -135.2 -118.0 -81.7 -158.4 -493.3Compensation of employees 55.1 4.3 18.9 34.5 10.7 68.4 5.6 14.6 50.1 4.8 75.0
Investment income -373.3 -101.3 -89.0 -103.7 -125.0 -419.0 -140.8 -132.6 -131.7 -163.2 -568.3
Other primary income 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
Secondary income 2197.2 547.4 570.1 576.1 535.7 2229.3 592.9 582.0 595.8 557.8 2328.4General government 204.1 31.5 45.5 38.9 34.4 150.3 45.5 45.5 40.1 51.2 182.3Financial corporations, nonfinancial corporations, households, and NPISHs
1993.1 515.8 524.5 537.3 501.3 2079.0 547.4 536.4 555.7 506.6 2146.1
o.w. Personal transfers 1855.7 484.6 486.7 495.8 470.9 1938.0 514.6 496.2 511.5 476.1 1998.4
Other current transfers 137.4 31.3 37.8 41.4 30.4 141.0 32.7 40.2 44.2 30.5 147.7
Capital account 5.8 1.4 1.5 5.5 9.3 17.7 2.8 1449.7 5.0 0.1 1457.5Capital transfers 5.8 1.4 1.5 5.5 9.3 17.7 2.8 1449.7 5.0 0.1 1457.5A. Current & Capital Account Balance -1225.5 -305.1 -321.5 -322.8 -11.0 -960.5 -114.8 1272.1 -75.0 116.3 1198.6
B. Financial Account Balance -1700.6 -244.6 -315.0 -229.3 -146.1 -935.0 -140.9 772.3 -209.2 -71.8 350.4Direct investment -694.6 -161.1 -142.4 -141.9 -221.5 -667.0 -198.5 -257.9 -253.4 -236.4 -946.3
Portfolio investment 8.2 149.2 -763.8 145.4 266.3 -202.9 302.6 -1876.3 16.1 426.0 -1131.6
Financial derivatives 69.9 -66.5 -48.8 -1.6 -2.0 -118.9 28.8 0.8 -1.2 -11.4 17.0
Other investment -1414.4 -134.1 -58.7 10.1 -404.7 -587.4 -121.4 2552.6 5.7 -191.6 2245.3
Reserve assets 330.2 -32.1 698.7 -241.4 215.9 641.1 -152.5 353.2 23.6 -58.3 166.0
Net errors and omissions (B minus A ) -475.1 60.6 6.5 93.5 -135.1 25.4 -26.1 -499.8 -134.2 -188.1 -848.1Memo Items:
Gross Reserves (Stock) e.o.p 2048.6 2016.5 2715.3 2473.9 2689.7 2689.7 2537.3 2890.5 2914.1 2894.3 2894.3Weeks of Goods & Services Imports 14.4 14.0 18.7 17.3 19.3 19.3 18.6 22.0 23.1 23.5 23.5
See Appendix B for equivalent table as percentage of Gross Domestic Production (GDP).
7
II. FISCAL YEAR REVIEW: April-March FY 2015/16
Overview
The current account balance for the 2015/16
fiscal year improved significantly by US$719.2
million to a deficit of US$258.9 million (or
1.9 per cent of GDP), relative to the previous
fiscal year (Figure 6). This represents a
continuation of the improvements observed in
the last three fiscal years. The improved
outturn emanated from all sub-accounts,
except the primary income sub-account
(Figure 7). The goods, services and secondary
income sub-accounts improved by US$585.0
million, US$177.8 million and US$99.2
million, respectively, while the primary
income sub-account reflected a deterioration
of US$142.8 million (Table 2).
The improvement in the combined goods and
services balance of US$2.09 billion,
increasing by 26.7 per cent, was largely driven
by a moderate expansion in services exports,
primarily travel earnings, and a fall in goods &
services imports led by lower fuel prices
(Figure 8).
Goods
For the goods sub-account, the deficit
contracted to US$3.06 billion relative to the
corresponding period in the previous fiscal
year, in which a larger deficit of US$3.65
billion was recorded. Goods imports
-944.2
-1,228.9
-2,174.2
-1,516.8
-1,231.3
-978.2
-258.9
2009/10 2010/11 2011/12 2012/13 2013/14 2014/15 2015/16
Figure 6: Current Account (Apr-Mar)US$ Millions
-3946.2 -3778.4 -3646.8-3061.8
600.3 668.2 789.9 967.7
FY2012/13 FY2013/14 FY2014/15 FY2015/16
Figure 8: Good & Services BalancesBy Fiscal Year
US$ Millions
Goods Exports Goods Imports
Services Exports Services Imports
Goods Trade Balance Services Trade Balance
-4311.2 -3946.2 -3778.4 -3646.8 -3061.8
609.1 600.3 668.2 789.9 967.7
2008.4 2084.5 2197.2 2229.3 2328.4
-480.6 -255.4 -318.3 -350.5
-493.3
2011/12 2012/13 2013/14 2014/15 2015/16
Figure 7: BOP Sub-AccountsBy Fiscal Year
FY2011/12 to FY2015/16US$ Millions
Goods Services Secondary Income Primary Income
8
decreased by US$794.1 million to US$4.25
billion, primarily driven by decreases in
mineral fuel and chemical imports of
US$742.9 million and US$63.2 million,
respectively. This was partially offset by an
increase in machinery & transportation
imports by US$107.7 million. Exports of
goods decreased by US$209.1 million to
US$1.2 billion, primarily as a result of a
decrease in exports of crude materials, food
and mineral fuel by US$43.4 million, US$35.8
million and US$34.0 million, respectively
(Figure 9).
Non-fuel Current Account
The current account excluding fuel trade
recorded a surplus of US$ million (or per
cent of GDP), representing a marginal
improvement of US$10.4 million relative to
FY2014/15 (Figure 10). Excluding mineral
fuel exports and imports, non-fuel
merchandise trade worsened by US$-123.8
million, over the previous fiscal year, to a
deficit of US$2 118.2 million. This
deterioration in the non-fuel merchandise trade
reflected a decline in non-fuel exports by 13.5
per cent, partly offset by a decline in non-fuel
imports by 1.6 per cent, relative to FY
2014/15 (Figure 11).
Figure 9: Change in Value of Goods Imports and Exports by SITC
April to March 2015/16 (y/y) US$ Millions
Source: STATIN
-2012.8 -1784.4 -1994.4 -2118.2
416.6753.4
674.2 684.6
-2500
-2000
-1500
-1000
-500
0
500
1000
1500
2000
2500
3000
FY2012/13 FY2013/14 FY2014/15 FY2015/16
Figure 10: Non-Fuel Current AccountUS$ Millions
Net Fuel Imports Non-Fuel Merchandise Trade
Fuel Exports Non-Fuel Current Account
-14.3
-2.8
-13.5
-12.6
5.6
-1.6
FY2013/14 FY2014/15 FY2015/16
Figure 11: Non-Fuel Exports & Imports% Growth (y/y)
Growth Rate in Non-Fuel Export Growth Rate in Non-Fuel Imports
9
Services
The balance on the services sub-account improved
by US$177.8 million to US$967.7 million for the
review period (Table 2). This resulted primarily
from gains in travel services, transport services and
insurance & pensions services of US$106.4 million,
US$59.2 million and US$39.2 million, respectively
(Figure 12). Growth in travel services for
FY2015/16 decelerated to 5.1 per cent, year-over-
year, from an 8-year high of 9.9 per cent recorded in
the previous fiscal year. The overall improvement in
the services balance was however partially offset by a
decline in other business services of US$12.5 million
(Figures 13).
Primary & Secondary Income
The secondary income balance improved by US$99.2
million to US$2,328.4 million reflecting higher
official grants supported by a small increase in
remittance inflows by 3.2 per cent (Figure 14). On
the other hand, the deficit on Primary Income sub-
account worsened by US$142.8 million, primarily
reflecting increased interest payments to non-
residents on GOJ Global bonds by 24.2 per cent
relative to the previous fiscal year as well as
significant repatriation of profits by foreign firms, up
by 42.5 per cent (Figure 15).
There was an improvement of US$1.44 billion in the
capital account, reflecting the discount received on
the PetroCaribe debt repurchase. This outturn
together with the balance on the current account
yielded a net lending balance on the capital and
current account of US$1.20 billion.
1881.1 1914.5 2104.7 2211.1
-748.8 -702.5 -635.1 -575.9
-532.0 -543.8 -679.7 -667.5
2012/13 2013/14 2014/15 2015/16
Figure 12: Services ComponentsBy Fiscal Year
US$ Millions
Travel Transportation Other Services
1.5 1.8
10.4
5.9
FY2012/13 FY2013/14 FY2014/15 FY2015/16
Figure 13: Tourist ExpenditureBy Fiscal Year
Growth Rate % (y/y)
1912.6 1993.1 2079.0 2146.1
2084.52197.2 2229.3 2328.4
0 0 0 0
Figure 14: Secondary IncomeBy Fiscal Year
US$ Millions
Official Transfers Private TransfersSecondary Income Balance
FY2012/13 FY2013/14 FY2014/15 FY2015/16
75.0
-568.3-615.7
-476.0
-376.2
-255.4
-318.3-350.5
-493.3
-800.0
-600.0
-400.0
-200.0
0.0
200.0
Figure 15: Primary IncomeBy Fiscal Year
US$ Millions
Compensation of employees Investment Income
10
Financial Account
The financial account recorded a net lending
balance of US$350.4 million, which was mainly
driven by transactions relating to the PetroCaribe
debt repurchases, resulting in a net repayment of
US$2.25 billion in other investment liabilities. This
was partly offset by a net take-up of US$1.13
billion in portfolio investment liabilities, primarily
stemming from the issuance of two bonds in the
September 2015 quarter. Financing from foreign
direct investment liabilities amounted to US$951.5
million (6.9 per cent of GDP) for FY2015/16,
representing a 43.4 per cent increase over the
previous fiscal year (Figure 16). Consequently, the
Bank’s gross reserves increased by US$166.0
million to US$2 894.3 million at end-March 2016,
representing 23.5 weeks of projected goods and
services imports (Table 2).
303.4402.6
576.3663.6
951.5
2.1%
2.7%
4.1%
4.8%
6.9%
0.0
1.0
2.0
3.0
4.0
5.0
6.0
7.0
8.0
0.0
100.0
200.0
300.0
400.0
500.0
600.0
700.0
800.0
900.0
1000.0
FY2011/12 FY2013/14 FY2015/16
% o
f G
DP
US$
MN
Figure 16: FDI Inflows by Fiscal Year
FDI Inflows % of GDP (RHS)
11
Glossary (BPM6)
The Sixth Edition of the Balance of Payments Manual (BPM6) format was first published in the March 2012
quarterly edition of this Report. Six major changes in BPM6 and definitions of key terminologies used in
this Report are highlighted below.
Six Major Changes in BPM6
1. The Goods sub-account and Services sub-account are now combined and referred to as the Goods and
Services sub-account.
2. The Income sub-account is now referred to as Primary Income.
3. The Current Transfers sub-account is now referred to as Secondary Income.
4. The Financial Account is no longer grouped with the Capital Account.
5. The balance from the Current and the Capital account is referred to as Net Lending or Net Borrowing, which is
explained by details in the Financial Account.
6. The use of debits and credits for the Financial Account is replaced by Net acquisition of financial assets and the
Net incurrence of liabilities.
Key Terminologies and Concepts
1. Balance of Payments
The balance of payments (BOP) is a summary of economic activities between the residents of a country
and the rest of the world during a given period, usually one year. The BOP is divided into two main
categories according to the broad nature of the transactions. These categories are the Current Account
and the Capital & Financial Account. The sum of the balances on the Current and Capital accounts
represents the Net Lending (surplus) or Net Borrowing (deficit) by the economy with the rest of the world.
This is conceptually equal to the net balance of the Financial Account. In other words, the Financial
Account measures how the Net Lending to or Net Borrowing from non-residents is financed. The balance
of every category of the financial account or net lending/borrowing is the difference between net
acquisition of assets and net incurrence of liabilities.
a. Net acquisition of financial assets is an increase in assets after deduction of their decrease.
b. Net incurrence of liabilities is an increase in liabilities after deduction of their decrease.
Note: A change with the “plus” sign shows an increase in assets or liabilities, whereas a change with
the “minus” sign shows a decrease in them.
12
2. Current Account
The current account includes all transactions (excluding those recorded in the capital and financial account)
between resident and non-resident entities that involve economic value. This account is sub-divided into:
a. Goods and Services
b. Primary Income, and
c. Secondary Income
a. The Goods and Services account covers merchandise trade, travel, transportation and other services.
i. Merchandise Trade records the value of exports and imports, of tangible goods, including those of
the free-zones and goods procured in ports by international carriers.
ii. Travel covers goods and services acquired from an economy by non-resident travellers for business
and personal purposes during their visits (of less than one year). Expenditures made by seasonal workers
(e.g. Jamaican farm workers) and those for educational and health-related purposes made by students and
medical patients are recorded in this sub-account.
iii. Transportation covers all transportation services (sea, air and land), bought and sold, that involve the
carriage of passengers, movement of goods (freight), charter of carriers with crew and other supporting
services.
iv. Other Services consist of the purchase and sale of: communication services, construction services,
insurance services, financial services, computer and information services, royalties and licences fees and
government services.
b. Primary Income represents the return that accrues to institutional units for their contribution to the
production process or for the provision of financial assets and renting natural resources to other
institutional units. It encompasses the compensation of employees, that is, salaries, wages and benefits of
seasonal and other non-resident workers. In addition, it includes investment income that consists of
dividends, profits, reinvested earnings, interest on debt and income on portfolio investment.
c. Secondary Income shows current transfers between residents and non-residents. It covers transactions
such as taxes on income, workers' remittances, and premiums and claims on non-life insurance.
13
3. Capital Account
The Capital Account covers:
(i) Capital Transfers include the transfer of ownership of fixed assets, the transfer of funds linked to
disposal/acquisition of fixed assets and the cancellation of debt by creditors.
(ii) Acquisition/disposal of non-produced, non-financial assets mainly involves intangibles such as
patents and leases. It also includes purchases and sales of land by foreign embassies.
4. Financial Account
The Financial Account records transactions that directly affect the wealth and debt of the country and
records transactions that involve financial assets and liabilities between residents and non-residents. This
account covers:
(i) Direct investment is the category of international investment in which a resident entity in one economy
acquires or disposes of 10 per cent or more of the ordinary shares or voting power of an enterprise
located in another economy and has an effective voice in management.
(ii) Portfolio Investment covers transactions in equity securities and debt securities. With respect to equity,
a portfolio investment would imply less than 10 per cent ownership of the voting power of an enterprise
located in another country. Debt securities include bonds and notes, money market instruments and
financial derivatives.
(iii) Financial Derivatives (other than reserves) covers transactions of forward-type contracts and options
traded in financial markets used to transfer risks linked to another specific financial instrument or
indicator or commodity.
(iv) Other investment is a residual category that includes all financial transactions not covered in Direct
Investment, Portfolio Investment or Reserve Assets. It includes: (i) Loans to finance trade (ii) Insurance,
pension and standardized guarantee schemes; (iii) trade credits and advances; and (iv) Other accounts
receivable/payable.
(v) Reserve Assets represent the foreign exchange which the country has available for financing an
imbalance of payments with the rest of the world.
14
Balance of Payments (US$MN) Balance of Payments (US$MN) 2016
2016 Jan-Mar 1/
Jan-Mar 1/ Current Account Balance 116.3
Credits 1,861.7
1. Current Account 116.3 Debits 1,745.5
A. Goods -680.8 Goods & Services -283.1
Exports 267.0 Exports 1,183.8
Imports 947.8 Imports 1,466.9
Goods -680.8
B. Services 397.7 Exports 267.0
Transportation -144.7 Imports 947.8
Travel 687.4 Services 397.7
Other Services -145.0 Exports 916.8
Imports 519.1
C. Income -158.4 Primary Income -158.4
Compensation of Employees 4.8 Credits 58.2
Investment Income -163.2 Debits 216.6
Secondary Income 557.8
D. Current Transfers 557.8 Credits 619.7
Official 51.2 Debits 62.0
Private 506.6 Capital Account 0.1
Credits 0.1
2. Capital & Financial Account -116.3 Debits 0.0
A. Capital Account 0.1 116.3
Capital Transfers 0.1
Official 0.1
Private 0.0 Financial Account
Acq/Disp. of Non-produced Non-fin. Assets 0.0 -71.8
B. Financial Account -116.3 Direct Investment -236.4
Direct Investment 236.4 Net acquisition of financial assets -0.1
Portfolio Investment -231.1 Net incurrence of liabilities 236.3
Other Official Investment -211.6 Portfolio Investments 426.0
Other Private Investment (incl. Errors & Omissions) 31.7 Net acquisition of financial assets 230.0
Reserves 58.3 Net incurrence of liabilities -196.1
Financial Derivatives -11.4
1/ Preliminary Net acquisition of financial assets -14.9
International Accounts Unit Net incurrence of liabilities -3.5
Economic Information & Publications Dept. Other Investments -191.6
August 2016 Net acquisition of financial assets -92.4
Net incurrence of liabilities 99.2
direct mapping Reserve Assets -58.3
change of sign on all Financial Account Items Net Errors and Omissions -188.1
1/ Preliminary
International Accounts Unit
Economic Information & Publications Dept.
August 2016
Net lending (+) / net borrowing (-) (balance
from current and capital account)
Net lending (+) / net borrowing (-) (balance
from financial account)
-
I S S N 0 7 9 9 3 2 9 3
Appendix A: Comparison of BOP Formats
Old Terminology New Terminology
Goods + Services = Goods & Services
Current a/c + Capital a/c = Net lending (+) / Net borrowing (-)
15
BOP Components (% of GDP)
BALANCE OF PAYMENTS OF JAMAICA (% of GDP)FY
2013/142014
Apr-Jun2014
Jul-Sep2014
Oct-Dec2015
Jan-MarFY
2014/152015
Apr-Jun2015
Jul-Sep2015
Oct-Dec2016
Jan-MarFY
2015/16Current account -8.7 -2.2 -2.3 -2.4 -0.1 -7.0 -0.9 -1.3 -0.6 0.8 -1.9Goods and services -22.1 -5.4 -5.9 -6.0 -3.2 -20.6 -4.2 -4.6 -4.3 -2.0 -15.1
Goods -26.8 -6.8 -6.8 -7.1 -5.6 -26.2 -5.9 -5.8 -5.5 -4.9 -22.1Exports 10.6 2.6 2.7 2.4 2.4 10.1 2.5 2.1 2.1 1.9 8.6
Imports 37.4 9.3 9.5 9.5 8.0 36.3 8.4 7.8 7.6 6.9 30.8
Services 4.7 1.3 0.9 1.1 2.4 5.7 1.8 1.1 1.2 2.9 7.0Transport -5.0 -1.2 -1.2 -1.2 -1.0 -4.6 -1.1 -1.0 -1.0 -1.0 -4.2
Travel 13.6 3.6 3.3 3.6 4.6 15.1 3.8 3.5 3.7 5.0 16.0
Construction -0.4 -0.1 -0.1 -0.1 -0.1 -0.5 -0.1 -0.2 -0.2 -0.1 -0.6
Insurance and pension services -0.9 -0.3 -0.4 -0.4 -0.2 -1.3 -0.1 -0.4 -0.3 -0.2 -1.0
Financial services -0.2 0.0 -0.1 -0.1 -0.1 -0.2 -0.1 -0.1 -0.1 -0.1 -0.2
Charges for the use of intellectual property n.i.e. -0.4 -0.1 -0.1 -0.1 -0.1 -0.3 -0.1 -0.1 -0.1 -0.1 -0.3
Telecommunications, computer, and information services 0.5 0.1 0.1 0.0 0.1 0.3 0.1 0.1 0.0 0.2 0.3
Other business services -2.7 -0.7 -0.7 -0.7 -1.0 -3.1 -0.8 -0.8 -0.8 -0.9 -3.2
Personal, cultural, and recreational services 0.5 0.1 0.1 0.1 0.1 0.5 0.1 0.1 0.1 0.1 0.5
Government goods and services n.i.e. -0.2 -0.1 -0.1 -0.1 -0.1 -0.2 -0.1 -0.1 -0.1 -0.1 -0.2
Primary income -2.3 -0.7 -0.5 -0.5 -0.8 -2.5 -1.0 -0.9 -0.6 -1.1 -3.6Compensation of employees 0.4 0.0 0.1 0.2 0.1 0.5 0.0 0.1 0.4 0.0 0.5
Investment income -2.7 -0.7 -0.6 -0.7 -0.9 -3.0 -1.0 -1.0 -1.0 -1.2 -4.1
Other primary income 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
Secondary income 15.6 3.9 4.1 4.1 3.9 16.0 4.3 4.2 4.3 4.0 16.8General government 1.4 0.2 0.3 0.3 0.2 1.1 0.3 0.3 0.3 0.4 1.3Financial corporations, nonfinancial corporations, households, and NPISHs
14.2 3.7 3.8 3.9 3.6 15.0 4.0 3.9 4.0 3.7 15.5
o.w. Personal transfers (Current transfers between resident
and nonresident households) 13.2 3.5 3.5 3.6 3.4 13.9 3.7 3.6 3.7 3.4 14.5
Other current transfers 1.0 0.2 0.3 0.3 0.2 1.0 0.2 0.3 0.3 0.2 1.1
Capital account 0.0 0.0 0.0 0.0 0.1 0.1 0.0 10.5 0.0 0.0 10.5Capital transfers 0.0 0.0 0.0 0.0 0.1 0.1 0.0 10.5 0.0 0.0 10.5A. Current & Capital Account BalanceNet lending (+) / net borrowing (-) (balance from current and capital account)
-7.6 -2.2 -2.3 -2.3 -0.1 -6.9 -0.8 9.2 -0.5 0.8 8.7
B. Financial Account BalanceNet lending (+) / net borrowing (-) (balance from financial account)
-8.4 -1.8 -2.3 -1.6 -1.1 -6.7 -1.0 5.6 -1.5 -0.5 2.5
Direct investment -4.9 -1.2 -1.0 -1.0 -1.6 -4.8 -1.4 -1.9 -1.8 -1.7 -6.8
Portfolio investment 0.1 1.1 -5.5 1.0 1.9 -1.5 2.2 -13.6 0.1 3.1 -8.2
Financial derivatives 0.5 -0.5 -0.4 0.0 0.0 -0.9 0.2 0.0 0.0 -0.1 0.1
Other investment -10.0 -1.0 -0.4 0.1 -2.9 -4.2 -0.9 18.5 0.0 -1.4 16.2
Reserve assets 2.3 -0.2 5.0 -1.7 1.6 4.6 -1.1 2.6 0.2 -0.4 1.2
Net errors and omissions (B minus A ) -3.4 0.4 0.0 0.7 -1.0 0.2 -0.2 -3.6 -1.0 -1.4 -6.1Memo Items:
Gross Reserves (Stock) e.o.p 14.5 14.5 19.5 17.8 19.3 19.3 18.4 20.9 21.1 20.9 20.9Weeks of Goods & Services Imports 0.1 0.1 0.1 0.1 0.1 0.1 0.1 0.2 0.2 0.2 0.2
Appendix B: Historical Balance of Payments Tables
16
Recent Five Quarters
Balance of Payments (US$MN) 2014/15:Q4 2015/16:Q1 2015/16:Q2 2015/16:Q3 2015/16:Q4
Jan-Mar Apr-Jun Jul-Sep Oct-Dec Jan-Mar
Current Account Balance -20.2 -117.6 -177.6 -80.0 116.3Credits 1,846.8 1,795.0 1,725.8 1,806.0 1,861.7
Debits 1,867.1 1,912.7 1,903.4 1,886.0 1,745.5
Goods & Services -441.6 -575.3 -641.6 -594.2 -283.1
Exports 1,191.4 1,087.9 1,003.2 1,035.9 1,183.8
Imports 1,633.0 1,663.1 1,644.8 1,630.1 1,466.9
Goods -772.3 -822.2 -797.6 -761.1 -680.8
Exports 336.5 344.4 286.7 293.6 267.0
Imports 1,108.7 1,166.6 1,084.3 1,054.7 947.8
Services 330.6 247.0 156.1 167.0 397.7
Exports 854.9 743.5 716.6 742.3 916.8
Imports 524.3 496.5 560.5 575.3 519.1
Primary Income -114.3 -135.2 -118.0 -81.7 -158.4
Credits 61.7 62.8 76.6 111.1 58.2
Debits 176.0 198.0 194.6 192.8 216.6
Secondary Income 535.7 592.9 582.0 595.8 557.8
Credits 593.7 644.4 645.9 659.0 619.7
Debits 58.0 51.5 64.0 63.1 62.0
Capital Account 9.3 2.8 1449.7 5.0 0.1Credits 9.3 2.8 1,449.7 5.0 0.1
Debits 0.0 0.0 0.0 0.0 0.0
Net lending (+) / net borrowing (-) (balance from current
and capital account) -11.0 -114.8 1272.1 -75.0 116.3
Financial Account
Net lending (+) / net borrowing (-) (balance from financial account) -146.1 -140.9 772.3 -209.2 -71.8
Direct Investment -221.5 -198.5 -257.9 -253.4 -236.4
Net acquisition of financial assets -1.0 -2.0 6.5 0.8 -0.1
Net incurrence of liabilities 220.6 196.5 264.5 254.2 236.3
Portfolio Investments 266.3 302.6 -1,876.3 16.1 426.0
Net acquisition of financial assets 403.0 157.9 22.9 -75.0 230.0
Net incurrence of liabilities 136.7 -144.7 1,899.2 -91.1 -196.1
Financial derivatives -2.0 28.8 0.8 -1.2 -11.4
Net acquisition of financial assets -12.2 21.1 -1.3 -1.3 -14.9
Net incurrence of liabilities -10.1 -7.7 -2.1 -0.1 -3.5
Other Investments -404.7 -121.4 2,552.6 5.7 -191.6
Net acquisition of financial assets -269.1 111.6 -108.1 40.7 -92.4
Net incurrence of liabilities 135.5 233.0 -2,660.6 35.1 99.2
Reserve Assets 215.9 -152.5 353.2 23.6 -58.3
Net Errors and Omissions -135.1 -26.1 -499.8 -134.2 -188.1
17
Full Fiscal Year
Balance of Payments (US$MN) 2014/145 2015/16
Apr-Mar Apr-Mar/ Change
Current Account Balance -978.2 -258.9 719.2Credits 7,172.4 7,188.6 16.2
Debits 8,150.6 7,447.5 -703.1
Goods & Services -2,856.9 -2,094.1 762.9
Exports 4,403.6 4,310.8 -92.8
Imports 7,260.6 6,404.9 -855.7
Goods -3,646.8 -3,061.8 585.0
Exports 1,400.8 1,191.7 -209.1
Imports 5,047.6 4,253.4 -794.1
Services 789.9 967.7 177.8
Credits 3,002.8 3,119.1 116.3
Debits 2,213.0 2,151.5 -61.5
Primany Income -350.5 -493.3 -142.8
Credits 303.1 308.7 5.6
Debits 653.7 802.0 148.3
Secondany Income 2,229.3 2,328.4 99.2
Credits 2,465.6 2,569.0 103.4
Debits 236.3 240.6 4.3
Capital Account 17.7 1457.5 1439.8Credits 17.7 1,457.5 1,439.8
Debits 0.0 0.0 0.0
Net lending (+)/ net borrowing (-) (balance from
current and capital account) -960.5 1,198.6 2,159.0
Financial Account
Net lending (+) / net borrowing (-) (balance from -935.0 350.4 1,285.5
Direct Investment -667.0 -946.3 -279.3
Net acquisition of financial assets -3.4 5.2 8.6
Net incurrence of liabilities 663.6 951.5 287.8
Portfolio Investments -202.9 -1,131.6 -928.7
Net acquisition of financial assets 655.1 335.7 -319.4
Net incurrence of liabilities 858.0 1,467.3 609.3
Financial derivatives -118.9 17.0 135.9
Net acquisition of financial assets -166.1 3.6 169.7
Net incurrence of liabilities -47.2 -13.4 33.8
Other Investments -587.4 2,245.3 2,832.7
Net acquisition of financial assets -186.4 -48.1 138.3
Net incurrence of liabilities 401.0 -2,293.4 -2,694.4
Reserve Assets 641.1 166.0
Net Errors and Omissions 25.4 -848.1
1/ Preliminary
International Accounts Unit
Economic Information & Publications Dept.
August 2016
18
Full Calendar Year
Balance of Payments (US$MN) 2015:Q1 2015:Q2 2015:Q3 2015:Q4 2015
Jan-Mar Apr-Jun Jul-Sep Oct-Dec Jan-Dec
Current Account Balance -20.2 -117.6 -177.6 -80.0 -395.4Credits 1,846.8 1,795.0 1,725.8 1,806.0 7,173.7
Debits 1,867.1 1,912.7 1,903.4 1,886.0 7,569.1
Goods & Services -441.6 -575.3 -641.6 -594.2 -2,252.6
Exports 1,191.4 1,087.9 1,003.2 1,035.9 4,318.4
Imports 1,633.0 1,663.1 1,644.8 1,630.1 6,571.0
Goods -772.3 -822.2 -797.6 -761.1 -3,153.3
Exports 336.5 344.4 286.7 293.6 1,261.1
Imports 1,108.7 1,166.6 1,084.3 1,054.7 4,414.4
Services 330.6 247.0 156.1 167.0 900.6
Exports 854.9 743.5 716.6 742.3 3,057.3
Imports 524.3 496.5 560.5 575.3 2,156.6
Primary Income -114.3 -135.2 -118.0 -81.7 -449.2
Credits 61.7 62.8 76.6 111.1 312.3
Debits 176.0 198.0 194.6 192.8 761.5
Secondary Income 535.7 592.9 582.0 595.8 2,306.4
Credits 593.7 644.4 645.9 659.0 2,543.0
Debits 58.0 51.5 64.0 63.1 236.6
Capital Account 9.3 2.8 1449.7 5.0 1466.7Credits 9.3 2.8 1,449.7 5.0 1,466.7
Debits 0.0 0.0 0.0 0.0 0.0
Net lending (+) / net borrowing (-) (balance from current
and capital account) -11.0 -114.8 1272.1 -75.0 1071.3
Financial Account
Net lending (+) / net borrowing (-) (balance from financial account) -146.1 -140.9 772.3 -209.2 276.1
Direct Investment -221.5 -198.5 -257.9 -253.4 -931.4
Net acquisition of financial assets -1.0 -2.0 6.5 0.8 4.3
Net incurrence of liabilities 220.6 196.5 264.5 254.2 935.7
Portfolio Investments 266.3 302.6 -1,876.3 16.1 -1,291.3
Net acquisition of financial assets 403.0 157.9 22.9 -75.0 508.7
Net incurrence of liabilities 136.7 -144.7 1,899.2 -91.1 1,800.1
Financial derivatives -2.0 28.8 0.8 -1.2 26.4
Net acquisition of financial assets -12.2 21.1 -1.3 -1.3 6.4
Net incurrence of liabilities -10.1 -7.7 -2.1 -0.1 -20.0
Other Investments -404.7 -121.4 2,552.6 5.7 2,032.2
Net acquisition of financial assets -269.1 111.6 -108.1 40.7 -224.8
Net incurrence of liabilities 135.5 233.0 -2,660.6 35.1 -2,257.1
Reserves Assets 215.9 -152.5 353.2 23.6 440.2
Net Errors and Omissions -135.1 -26.1 -499.8 -134.2 -795.1
Revised
International Accounts Unit
Economic Information & Publications Dept.
August 2016
19
BANK OF JAMAICA Nethersole Place
P.O. Box 621 Kingston, Jamaica
Telephone: 876 922 0750 Internet: www.boj.org.jm
