Balance of Payments

The balance of payments is a summary of the transactions of an economy with the rest of the world in a given period. It is made up of the current account and the financial and capital account. The current account comprises the balance of trade in visible goods such as manufactured items or commodities, in invisible goods such as tourism, insurance and other services, net income flows such as wages and investment income and net transfers such as international aid. The financial account includes net investment from abroad, long-term capital flows from the purchase or sale of foreign assets such as land or investments in foreign companies. It also includes short-term capital flows such as money moved from one country to another by multinational companies and profits or losses from investments in foreign currencies by speculators.

See also: Trade Figures