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Capital Account Surplus and

Deficit of major economies

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Balance of Payments(BOP)The measurement of all international economictransactions between the residents of a country

and foreign residents is called the balance ofpayments (BOP)

The BOP of a country is a systematic record ofall economic transactions between the

residents of a country and the rest of the world.

It presents a classified record of all receipts on aaccount of goods exported, services rendered

and capital received by residents and paymentsmade b them on account of oods im orted and

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BOP accountsCurrent Account

Visible net + Invisible net = Current AccountBalance

Credit > Debit Current A/c surplus

Credit < Debit Current A/c Deficit

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Capital/ Financial AccountCapital Account = Change in foreignownership of domestic

assets Change in domestic ownership offoreign assets

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Capital AccountCapital transfers related to the purchase andsale of fixed assets. E.g.: Real estate

This account of the BOP measures all

international economic transactions offinancial assets

A national account that shows the net change

in asset ownership for a nation. The capitalaccount is the net result of public and privateinternational investments flowing in and out ofa country.

May also refer to an account showing the net

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The Capital Account is made up of transfers of:

Financial assets

The acquisition and disposal of nonproduced/non financial assets.

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Capital AccountBreaking this down:

Capital Account = Foreign direct investment +Portfolio investment + Otherinvestment + Reserve account

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Capital Account SurplusAn imbalance in a nation's balance ofpayments capital account in which payments

received by the country for selling domesticassets exceed payments made by the countryfor purchasing foreign assets.

A surplus in the capital account meansmoney is flowing into the country,

In other words, investment by the domesticeconomy in foreign assets is greater than

foreign investment in domestic assets.

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Capital Account DeficitAn imbalance in a nation's balance of paymentscapital account in which payments made by thecountry for purchasing foreign assets exceed

payments received by the country for sellingdomestic assets.

A deficit in the capital account means money isflowing out the country, but it also suggests the

nation is increasing its claims on foreign assets.

This means foreigners are gaining possession ofassets in a particular economy.

In other words, investment by the domesticeconom in forei n assets is less than forei n

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Major Economies : U.S.The Net capitalaccount (BoP; USdollar) in the UnitedStates was last

reported at -152347000.00 in2010, according to aWorld Bank reportreleased in 2011. The

Net capital account(BoP; US dollar) inthe United States was-140127000.00 in2009, according to aWorld Bank report,published in 2010.

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Japan The Net capitalaccount (BoP; USdollar) in Japan waslast reported at -

6190187428.03 in2010, according to aWorld Bank reportreleased in 2011. TheNet capital account

(BoP; US dollar) inJapan was -7416992078.16 in2009, according to aWorld Bank report,published in 2010.The Net capital

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UK The Net capitalaccount (BoP; USdollar) in the UnitedKingdom was last

reported at5182095196.59 in2010, according to aWorld Bank reportreleased in 2011. The

Net capital account(BoP; US dollar) in theUnited Kingdom was5709235309.12 in2009, according to aWorld Bank report,published in 2010. The

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Russia

The Net capital account(BoP; US dollar) in Russia

was last reported at72872100.00 in 2010,according to a World Bankreport released in 2011.The Net capital account(BoP; US dollar) in Russiawas -12114351700.00 in2009, according to a WorldBank report, published in2010. The Net capitalaccount (BoP; US dollar) in

Russia was reported at

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GreeceThe Net capitalaccount (BoP; USdollar) in Greece was

last reported at2792645409.88 in2010, according to aWorld Bank reportreleased in 2011. The

Net capital account(BoP; US dollar) inGreece was2937026495.32 in2009, according to aWorld Bank report,

published in 2010.

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GermanyThe Net capitalaccount (BoP; USdollar) in Germany was

last reported at -822381384.49 in 2010,according to a WorldBank report releasedin 2011. The Net

capital account (BoP;US dollar) in Germanywas 69479651.64 in2009, according to aWorld Bank report,

published in 2010. TheNet capital account

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China

China's capital and

financial account swunginto a deficit of $71.4billion from a surplus of$56.1 billion in the firstquarter as domestic

firms and residentsincreased their holdingsof foreign currenciesamid the globalturbulence.

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IndiaThe Net capitalaccount (BoP; USdollar) in India was lastreported at -1306390.72 in 2010,according to a WorldBank report releasedin 2011. Net capitalaccount includes

government debtforgiveness,investment grants incash or in kind by agovernment entity, and

taxes on capitaltransfers. Also

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ANKUR(04)

PANKAJ MOR(12)

SUMITRA MOHANTY(14)C.M PRASHANT(16)

MANISH TIRKEY(25)