Balance of Payments

FBoS Release No: 58, 2015

16th September 2015


All values in this release are in Fiji Dollars (FJD).

ANNUAL 2014

Provisional Balance of Payments data for 2014 show the following:

Current and Capital account deficit narrowed to $606.5 million, with the following major movements;

  • Value of Imports exceeded Exports by $1,940.2 million;
  • Increase in Tourism Earnings;
  • Inward Remittance exceeded Outward Remittance by $309.2 million and
  • The Reinvestment of Profits by Foreign Owned Companies amounting to $343.8 million.

Financial account deficit widened to $957.4 million with the following major movements;

  • Increase in Investment transactions of foreign owned entities by $87.9 million and
  • A decrease in Loans sourced from abroad.

CURRENT ACCOUNT – main components include Fiji’s trade balance, investment income and current transfers.

Table 1

bopDec14a

The balance on current account for 2014 showed a net outflow of $614.6 million. This was a decrease when compared to the $760.4 million net outflow recorded in 2013. The following flows were recorded:

 

  • Net goods deficit decreased by $209.3 million (from $2,149.5 million to $1,940.2 million) due to an increase in the exports of sugar;
  • Net services surplus increased by $100.0 million (from $1,160.7 million to $1,260.7 million) largely due to an increase in the earnings from tourism;
  • Net primary income deficit increased by $227.2 million (from $148.3 million to $375.5 million) as there was an increase in the outflow of reinvested earnings and
  • Net secondary income surplus increased by $63.7 million (from $376.7 million to $440.4 million) due to an increase in personal transfers.

The following graph shows the current account and its major aggregates.

bopDec14b

CAPITAL ACCOUNT - tracks flow of aid and grants either in cash or kind for capital development and equipment purchase.

Table 2

bopDec14c

The capital account recorded a net inflow of $8.1 million for 2014. This was a decrease of $0.8 million lower than the net inflow recorded a year earlier.

FINANCIAL ACCOUNT – describes the change in ownership of international assets and liabilities.

Table 3

bopDec14d

The balance on financial account for 2014 recorded a net borrowing of $957.4 million which consisted of net outflows of $625.7 million in equity and $331.7 million in debts.

Direct investment recorded a net outflow of $553.9 million. An increase of $76.2 million from the net outflow of $477.7 million a year earlier where;

  • Direct investment assets recorded an inflow of $72.4 million;
  • Direct investment liabilities recorded an inflow of $626.3 million.

Portfolio investment recorded a net inflow of $20.5 million. A decrease of $22.5 million from the net inflow of $43.0 million a year earlier where;

  • Portfolio investment assets recorded an inflow of $20.5 million;
  • Portfolio investment liabilities recorded no transaction.

Other investment recorded a net outflow of $460.6 million, an increase of $144.7 million from the net outflow of $315.9 million a year earlier. This was the net effect of the following:

  • Other investment assets recorded an outflow of $271.5 million. This was due to the outflows of $260.4 million in currency and deposits, $13.0 million in trade credit and advances and $1.9 million in loans. However, there were inflow contributions of $3.1 million in other accounts receivable and $0.7 million in other equity.
  • Other investment liabilities recorded an inflow of $189.1 million. This was due to the inflows of $112.3 million in loans, $66.9 million in currency and deposits, $5.7 million in trade credit and advances, $2.2 million in other accounts receivable and $2.0 million in other equity.

Reserve assets recorded a net inflow of $36.6 million, a decrease of $103.5 million from the net inflow of $140.1 million recorded a year earlier.

The following graph shows the financial account and it’s major aggregates.

bopDec14e

DECEMBER QUARTER 2014

Provisional Balance of Payments data for the December quarter of 2014 show the following:

  • The Current and Capital account deficit of $171.9m;
  • Financial account deficit of $234.7m.

CURRENT ACCOUNT – main components include Fiji’s trade balance, investment income and current transfers.

Table 4

bopDec14f

 

The current account balance for the December quarter of 2014 showed a net outflow of $175.1 million. This was a slight decrease of $7.9 million when compared to the $183.0 million net outflow recorded a year earlier. The following flows were recorded:

  • Net goods deficit decreased by $15.8 million (from $531.5 million to $515.7 million) largely due to a decrease in the imports of machinery and transport equipment;
  • Net services surplus increased by $59.3 million (from $283.5 million to $342.8 million) largely due to an increase in earnings from tourism;
  • Net primary income deficit increased by $88.3 million (from $28.3 million to $116.6 million) as there was an increase in the outflow of reinvested earnings and
  • Net secondary income surplus increased by $21.1 million (from $93.3 million to $114.4 million) due to an increase in personal transfers.

The following graph shows the current account and its major aggregates.

bopDec14g

CAPITAL ACCOUNT – tracks flow of aid and grants either in cash or kind for capital development and equipment purchase.

Table 5

bopDec14h

The capital account recorded a net inflow of $3.2 million in the December quarter of 2014.

 FINANCIAL ACCOUNT – describes the change in ownership of international assets and liabilities.

Table 6

bopDec14i

The balance on financial account in the December quarter of 2014 recorded a net borrowing of $234.7 million which consisted of net outflows of $221.7 million in equity and $13.0 million in debts.

 

Direct investment recorded a net outflow of $242.2 million, an increase of $126.8 million from the net outflow of $115.4 million a year earlier where;

  • Direct investment assets recorded no transaction;
  • Direct investment liabilities recorded an inflow of $242.2 million. This was due to an increase in investment from abroad.

Portfolio investment recorded a net inflow of $10.5 million, an increase of $5.9 million from the net inflow of $4.6 million a year earlier where;

  • Portfolio investment assets recorded an inflow of $10.5 million;
  • Portfolio investment liabilities recorded no transaction.

Other investment recorded a net outflow of $60.3 million, a decrease of $120.7 million from the net inflow of $60.4 million a year earlier. This was the net effect of the following:

  • Other investment assets recorded a net outflow of $44.5 million. This was due to the outflows of $42.5 million in currency and deposits, $2.2 million in loans, $1.0 million in other accounts receivable and an inflow of $1.2 million in trade credit and advances.
  • Other investment liabilities recorded a net inflow of $15.8 million. This was due to the inflow of $92.0 million in loans. However, there were outflows of $63.8 million in currency and deposits, $11.8 million in trade credit and advances, $0.4 million in other accounts receivable and $0.2 million in other equity.

Reserve assets recorded a net inflow of $57.3 million, an increase of $85.4 million from the net outflow of $28.1 million a year earlier.

The following graph shows the financial account and it’s major aggregates.

bopDec14j

The International Monetary Fund’s Balance of Payment and International Investment position Manual Sixth Edition (BPM6) has been used in compiling the detailed Balance of Payments Statistics from 2005. Apart from the annual data, tables attached also contain the quarterly aggregates.

 

CLICK HERE FOR RELATED TABLES

 

References can also be made to Fiji Bureau of Statistics’ Quarterly Releases on International Investment Position (IIP), Trade in Services and the monthly Releases on International Merchandise Trade Statistics (IMTS). However, caution should be exercised when comparing imports reported in the IMTS Release as they are on a CIF (cost, insurance and freight) basis, whereas in Balance of Payments adjustments are made to the imports to have it reported on FOB (free on board) basis.

For further enquiries please contact Ms. Torika Ketenilagi on email or telephone 331 5822 (ext. 386246) or direct line 323 0846.

The Balance of Payments Statistics for March quarter 2015 will be released as soon as the disaggregated data becomes available.