THE BALANCE OF PAYMENTS3 I. BALANCE OF PAYMENTS SUMMARY October-December 2015 Jamaica recorded a current account deficit of US$72.9 million (or 0.5 per cent of GDP) for the October

1

Preliminary QUARTERLY REPORT

December 2015

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

December 2015


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

z

TABLE OF CONTENTS

Page

Balance of Payments Summary

October to December 2015 3

January to December 2015 5

April to December FY 2015/16 7

Quarter Review

Current Account 11

Capital Account 13

Financial Account 14

Glossary (BPM6) 15

Appendix:

Historical Balance of Payments Tables 18

Comparison of BOP Formats 22

2

Table 1: Review Quarter

Balance of Payments (US$MN) 2014:Q4 2015:Q4

Oct-Dec Oct-Dec/ Change

Current Account Balance -367.6 -72.9 294.7

Credits 1,790.6 1,777.7 -12.9

Debits 2,158.2 1,850.6 -307.6

Goods & Services -855.4 -617.5 237.8

Exports 1,044.6 1,006.8 -37.8

Imports 1,900.0 1,624.3 -275.7

Goods -988.7 -761.1 227.5

Exports 333.5 293.6 -39.9

Imports 1,322.2 1,054.7 -267.4

Services 133.3 143.6 10.3

Exports 711.1 713.2 2.1

Imports 577.9 569.6 -8.3

Primary Income -102.3 -52.0 50.3

Credits 95.5 111.3 15.7

Debits 197.9 163.2 -34.6

Secondary Income 590.1 596.6 6.6

Credits 650.4 659.7 9.3

Debits 60.3 63.0 2.7

Capital Account 5.5 5.0 -0.6

Credits 5.5 5.0 -0.6

Debits 0.0 0.0 0.0

Net lending (+) / net borrowing (-) (balance from current and capital

account) -362.1 -67.9 294.2

Financial Account

Net lending (+) / net borrowing (-) (balance from financial account) -108.9 -132.1 -23.2

Direct Investment -139.3 -177.4 -38.1

Net acquisition of financial assets 0.4 0.9 0.4

Net incurrence of liabilities 139.7 178.2 38.5

Portfolio Investments 145.4 16.1 -129.4

Net acquisition of financial assets -76.1 -75.0 1.1

Net incurrence of liabilities -221.5 -91.1 130.4

Financial derivatives -1.6 -1.2 0.4



Other Investments 127.8 6.7 -121.2


Net incurrence of liabilities -26.8 117.7 144.5

Reserve Assets -241.4 23.6

Net Errors and Omissions 253.1 -64.2

1/ Provisional


Economic Information & Publications Dept.

April 2016

3

I. BALANCE OF PAYMENTS SUMMARY

October-December 2015

Jamaica recorded a current account deficit of

US$72.9 million (or 0.5 per cent of GDP)

for the October to December 2015 quarter,

representing a US$294.7 million

improvement relative to the corresponding

period in 2014 (Figure 1). It also represents

the most favourable current account balance

for a December quarter since 1994. The outturn for the review quarter represents a return to the upward

trend since 2011 after a brief decline in 2013 (Figure 1). The improved current account for the review

period stemmed from all sub-accounts. In particular, the goods, primary income, services and secondary

income sub-accounts improved by US$227.5 million, US$50.3 million, US$10.3 million, and US$6.6

million, respectively (Table 1). Goods and services imports decreased mainly as a result of lower fuel

prices, and outweighed lower exports.

The balance on the capital account fell by US$0.6 million, reflecting a surplus of US$5.0 million in

December 2015, down from a surplus of US$5.5 million in the previous corresponding quarter. This

outturn combined with the balance on the current account returned a net borrowing balance of

US$67.9 million, a decrease in borrowing of US$294.2 million relative to the December 2014 quarter.

There was a net borrowing balance on the financial account of US$132.1 million for the review quarter.

This was mainly comprised of net direct investment inflows of US$177.4 million (Table 1). Financial

inflows were therefore sufficient for financing the net borrowing balance on the current and capital

accounts. As a result, gross reserves increased by US$23.6 million over the quarter.

-484.2 -447.6

-416.1

-664.2

-428.3-484.6

-363.6

-72.9

-700

-600

-500

-400

-300

-200

-100

0

2008 2009 2010 2011 2012 2013 2014 2015

US

$ M

n

Figure 1: Current Account (Oct-Dec)

4

Table 2: Review Calendar Year

Balance of Payments (US$MN) 2014 2015 1/

Jan-Dec Jan-Dec Change


Credits 7,127.3 7,069.4 -57.9

Debits 8,255.4 7,395.6 -859.8

Goods & Services -3,132.9 -2,347.1 785.8

Exports 4,308.0 4,204.3 -103.6

Imports 7,440.9 6,551.5 -889.4

Goods -3,759.0 -3,153.3 605.7

Exports 1,448.6 1,261.1 -187.5

Imports 5,207.6 4,414.4 -793.2

Services 626.1 806.1 180.0

Exports 2,859.4 2,943.2 83.9

Imports 2,233.2 2,137.1 -96.2

Primary Income -286.5 -312.3 -25.8

Credits 296.7 295.2 -1.5

Debits 583.2 607.6 24.4

Secondary Income 2,291.2 2,333.3 42.1

Credits 2,522.6 2,569.8 47.2

Debits 231.4 236.5 5.2

Capital Account 9.1 1466.7 1457.6

Credits 9.1 1,466.7 1,457.6

Debits 0.0 0.0 0.0

Net lending (+)/ net borrowing (-) (balance from

current and capital account) -1,119.1 1,140.5 2,259.6

Financial Account

Net lending (+) / net borrowing (-) (balance from -1,172.9 413.0 1,585.9


Net acquisition of financial assets -2.1 4.4 6.5


Portfolio Investments -465.9 -1,291.4 -825.5


Net incurrence of liabilities 782.2 1,800.1 1,017.9

Financial derivatives -178.1 26.4 204.5



Other Investments -591.5 2,027.9 2,619.4


Net incurrence of liabilities 276.1 -2,169.5 -2,445.6

Reserve Assets 656.3 440.2

Net Errors and Omissions -53.8 -727.5

1/ Preliminary



April 2016

5

January to December 2015

The current account balance improved by

US$802.0 million during the 2015 calendar

year to a deficit of US$326.2 million (or 2.4

per cent of GDP), relative to the 2014

calendar year (Figure 2). This continues a

trend of improvements in the current

account since 2011. The improved outturn

for the review period emanated from all

sub-accounts except primary income. The goods, services, and secondary income sub-accounts

improved by US$605.7 million, US$180.0 million, and US$42.1 million, respectively. However, in

contrast, the primary income sub-account deteriorated by US$25.8 million (Table 2).

The goods trade deficit of US$3.15 billion reflected an improvement of US$605.7 million. This was

underpinned by a US$793.2 million reduction in goods imports. The reduction in goods imports to

US$4.41 billion was principally driven by decreases in mineral fuel and food imports of US$824.9

million and US$78.4 million, respectively (Figure 3). A notable offsetting impulse to the overall

reduction in imports was an increase in the importation of machinery & transport equipment of

US$66.6 million. Goods exports also declined by US$187.5 million to US$1.26 billion, mainly as a

result of a decrease in mineral fuel and food exports of US$34.2 million and US$19.9 million,

respectively (Figure 4).

-1,127.5

-934.9

-1,913.8

-1,378.6-1,316.0

-1,110.1

-326.2

-2,500

-2,000

-1,500

-1,000

-500

0

2009 2010 2011 2012 2013 2014 2015

US$

Mn

Figure 2: Current Account (Jan-Dec)

-19.9 -19.8

-8.8

-34.2

-0.1 -2.8

-17.3

-1.6

-5.6-3.0

-40

-35

-30

-25

-20

-15

-10

-5

0

US$ M

n

Figure 4: Change in Exports by SITC: Jan-Dec

-78.4 -1.7 -7.4

-824.9

-3.0 -19.335.4 66.6

-12.3 -6.3

-900

-800

-700

-600

-500

-400

-300

-200

-100

0

100

200

US$

Mn

Figure 3: Change in Imports by SITC: Jan-Dec

Source: STATIN Source: STATIN

6

The balance on the services sub-account improved by US$180.0 million to US$806.1 million for the

review period resulting primarily from gains in transportation, travel, and insurance & pension services

of US$125.1 million, US$87.2 million, and US$18.5 million, respectively. However, the improvement

was partially offset by a decline in other business services of US$24.3 million.

There was an improvement of US$1.46 billion in the capital account from the surplus of US$9.1

million recorded in 2014 to US$1.47 billion in 2015, 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$1.14 billion.

The financial account recorded a net lending balance of US$413.0 million, which was mainly driven by

transactions relating to the PetroCaribe debt repurchase, resulting in a net repayment of US$2.17 billion

in other investment liabilities and a net take-up of US$1.8 billion in portfolio investment liabilities,

primarily stemming from the issuing of two bonds in the September 2015 quarter. This facilitated an

increase in gross reserves of US$440.2 million.

7

April-December FY 2015/16

The current account balance for the April

to December 2015/16 fiscal period

improved by US$656.8 million to a deficit

of US$352.0 million (or 2.6 per cent of

GDP), relative to the previous

corresponding period (Figure 5). This

represents a continuation of the

improvements observed in the last three

fiscal years. The improved outturn for the review period emanated from all sub-accounts. The goods,

services, and secondary income sub-accounts improved by US$493.5 million, US$107.7 million, and

US$53.8 million, respectively, while the primary income sub-account gained a marginal US$1.7 million

(Table 3).

For the goods sub-account, the deficit decreased to US$2.38 billion relative to the corresponding

period in the previous fiscal year, in which a larger deficit of US$2.87 billion was recorded. Goods

imports decreased by US$633.2 million to US$3.31 billion, primarily driven by decreases in mineral

fuel and food imports of US$612.4 million and US$47.2 million, respectively (Figure 6). This was

partially offset by an increase in machinery & transport equipment imports of US$58.4 million. Exports

of goods decreased by US$139.7 million to US$924.7 million, primarily as a result of a decrease in

exports of food by US$22.4 million and mineral fuel by US$20.1 million (Figure 7).

-559.4

-911.8

-901.6

-1,728.1

-1,199.6-1,058.3

-363.6 -352.0

-2,000

-1,800

-1,600

-1,400

-1,200

-1,000

-800

-600

-400

-200

0

2002/03 2009/10 2010/11 2011/12 2012/13 2013/14 2014/15 2015/16

US$

Mn

Figure 5: Current Account (Apr-Dec)

-22.4

-16.4

-4.5

-20.1

-0.2 -2.4

-13.2

0.2 -4.6 -3.4

-25

-20

-15

-10

-5

0

5

US$ M

n

Figure 7: Change in Exports by SITC: Apr-Dec

-47.2 -0.5 -3.5

-612.4

-2.3 -40.8 13.858.4

-31.3 -14.2

-700

-600

-500

-400

-300

-200

-100

0

100

US$ M

n

Figure 6: Change in Imports by SITC: Apr-Dec


8

The balance on the services sub-account improved by US$107.7 million to US$507.1 million for the

review period resulting primarily from gains in transportation services, travel, and insurance & pensions,

of US$64.2 million, US$47.8 million, and US$32.4 million, respectively. However, the improvement

was partially offset by a decline in other business services of US$13.2 million.

There was an improvement of US$1.45 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$1.11 billion.

The financial account recorded a net lending balance of US$537.4 million, which was mainly driven by

transactions relating to the PetroCaribe debt repurchases, resulting in a net repayment of US$2.31

billion in other investment liabilities and a net take-up of US$1.66 billion in portfolio investment

liabilities, primarily stemming from the issuance of two bonds in the September 2015 quarter. This

facilitated an increase in gross reserves of US$224.3 million.

9

Table 3: Fiscal Year to Date

Balance of Payments (US$MN) 2014/15 2015/16

Apr-Dec Apr-Dec/ Change


Credits 5,287.3 5,255.4 -31.9

Debits 6,296.1 5,607.4 -688.7

Goods & Services -2,475.2 -1,873.9 601.3

Exports 3,145.3 3,046.9 -98.4

Imports 5,620.5 4,920.8 -699.7

Goods -2,874.5 -2,381.0 493.5

Exports 1,064.3 924.7 -139.7

Imports 3,938.9 3,305.7 -633.2

Services 399.3 507.1 107.7

Credits 2,081.0 2,122.3 41.3

Debits 1,681.6 1,615.2 -66.5

Primary Income -268.9 -267.2 1.7

Credits 228.3 240.8 12.4

Debits 497.3 508.0 10.7

Secondary Income 1,735.3 1,789.2 53.8

Credits 1,913.7 1,967.7 54.1

Debits 178.3 178.6 0.2

Capital Account 8.5 1457.4 1449.0

Credits 8.5 1,457.4 1,449.0

Debits 0.0 0.0 0.0

Net lending (+)/ net borrowing (-) (balance from

current and capital account) -1,000.3 1,105.5 2,105.8

Financial Account

Net lending (+) / net borrowing (-) (balance from -673.2 537.4 1,210.5




Portfolio Investments -469.2 -1,557.7 -1,088.5

Net acquisition of financial assets 252.1 105.7 -146.4

Net incurrence of liabilities 721.3 1,663.4 942.1

Financial derivatives -116.9 28.4 145.3



Other Investments -46.1 2,437.9 2,484.0


Net incurrence of liabilities 120.9 -2,310.0 -2,430.9

Reserve Assets 425.3 224.3

Net Errors and Omissions 327.1 -568.1

1/ Preliminary



April 2016

10

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11

II. QUARTER REVIEW

Current Account

For the October to December 2015 quarter,

there was a current account deficit of

US$72.9 million (or 0.5 per cent of GDP)

(Figure 8), representing a US$294.7 million

(or 80.2 per cent) improvement relative to

the corresponding period in 2014. It also

represents the most favourable current

account balance for a December quarter

since 1994 (Figure 1). The outturn for the review quarter represents a return to the upward trend in the

current account balance for December quarters since 2011 after a decline in 2014. The improved

outturn for the review period emanated from all sub-accounts. Specifically, the goods, primary income,

services, and secondary income accounts improved by US$227.5 million, US$50.3 million, US$10.3

million, and US$6.6 million, respectively (Table 1).

The improvement in the goods account was

primarily due to a decline in imports which was

partially offset by a decline in exports. The

decline in imports of US$267.4 million (or 20.2

per cent) was mostly reflective of reductions in

mineral fuel imports and imports of

miscellaneous manufacturing goods of US$201.2

million and US$33.3 million, respectively

(Figure 10). However, this was partially offset by a US$6.6 million increase in machinery & transport

equipment imports.

The decline of US$39.9 million (or 12.0 per cent) in exports was largely driven by reductions in food,

beverage & tobacco, and chemicals exports of US$11.1 million, US$8.5 million and US$8.2 million,

respectively (Figure 11). This was partially offset by an increase of US$4.6 million in exports of

machinery & transport equipment. Mineral fuel prices were, on average, 49.4 per cent lower compared

-2500

-2000

-1500

-1000

-500

0

500

1000

1500

US

$ M

n

Figure 9: Evolution of Key Current Account Components

Goods Exports Goods Imports Services Exports Services Imports

-1.2-2.0

-3.6-2.6

-1.7 -1.6 -2.2-3.4

-0.8-2.2 -2.4 -2.7

0.2-0.8 -1.2 -0.5

-10

-8

-6

-4

-2

0

2

4

6

8

% o

f G

DP

Figure 8: Contribution to Current Account Balance by Component

Goods Services Primary income

Secondary income Current account

12

to the corresponding period in 2014. This largely contributed to the reduction in the value of mineral

fuel imports.

The improvement in the balance on the services

sub-account resulted primarily from an

improvement of US$19.5 million (or 0.2 per

cent) and US$1.6 million (or 11.9 per cent) in

net transport, and insurance & pension services

flows, respectively. Transport outflows declined

due to lower freight charges, stemming from

lower fuel prices and correspondingly lower fuel

imports. Also, travel receipts were boosted by

increases in average expenditure per visitor and

stop-over arrivals (Figure 12a). However,

growth rates in travel receipts have moderated

since the December 2014 quarter (Figure 12b).

These increases were partially offset by a decline

of US$7.2 million (or 2.9 per cent) in

construction services.

The primary income account balance improved by US$50.3 million (or 49.2 per cent) during the

review period to a deficit of US$52.0 million (Figure 12). Net compensation of employees was

US$50.1 million for the quarter, an improvement of US$15.5 million (or 45.0 per cent) relative to the

December 2014 quarter.

619

505 488458

609

502475 488

630

541 521563

681

567 553578

0

200

400

600

800

Figure 12a: Tourist Expenditure (US$Mn)

-1.7-0.5

-2.6

6.6

3.6

7.89.6

15.3

8.1

4.86.2

2.7

-4-202468

1012141618

Figure 12b: Tourist Expenditure (Growth Rate q-o-q %)

Source: Jamaica Tourist Board

-11.1

-8.5

0.3

-3.9

-0.1

-8.2

3.0

4.6

-1.3 -1.3

-12

-10

-8

-6

-4

-2

0

2

4

6

US

$ M

n

Figure 11: Change in Exports by SITC: Oct-Dec

-2.9 -0.5 -4.5

-201.2

1.7 -26.0 -0.6 6.6 -33.3

-17.3

-250

-200

-150

-100

-50

0

50

US

$ M

n

Figure 10: Change in Imports by SITC: Oct-Dec


13

The secondary income account recorded a balance of US$596.6 million, an increase of US$6.6 million

(or 1.1 per cent), principally originating from higher net private transfers of US$15.7 million (or 3.2

per cent) for the quarter. Official transfers also declined by US$9.1 million (or 17.2 per cent) over the

same period.

Non-fuel Current Account

The current account excluding fuel trade

recorded a surplus of US$114.5 million (or

0.8 per cent of GDP), representing an

improvement of US$96.8 million relative to

the December 2014 quarter (Figure 13).

Excluding mineral fuel exports and imports,

merchandise trade improved by US$29.5

million to a deficit of US$573.8 million (or

4.2 per cent of GDP) as a result of

improvements in all other sub-accounts.

The improvement in the non-fuel current account occurred in spite of a decline in non-fuel merchandise

exports to US$274.6 million (or 2.0 per cent of GDP), representing a US$36.7 million decline

relative to the December 2014 quarter. This was, however, offset by a larger decline in non-fuel

merchandise imports of US$66.2 million to US$848.4 million (or 6.2 per cent of GDP).

Capital Account

The balance on the capital account deteriorated by US$0.6 million in the December 2015 quarter,

compared to a surplus of US$5.5 million in the previous corresponding quarter. This outturn

combined with the balance on the current account returned a net borrowing position of US$67.9

million.

440.5589.6

407.5

206.3

-554.5 -560.7 -603.3 -573.8

1.461.3 17.7 114.5

-379.0

-545.9 -385.3

-187.3

-800

-600

-400

-200

0

200

400

600

800

Figure 13: Non-Fuel Current Account (US$Mn)

Fuel Imports Non-Fuel Merchandise Trade Non-Fuel Current Account Fuel Trade Balance

14

Financial Account

There was a net borrowing balance in the

financial account of US$132.1 million for the

review quarter. Net inflows to the financial

account (17.1 per cent of GDP) were

sufficient for financing the current account

deficit. There were net portfolio investment

outflows of US$16.1 million for the

December 2015 quarter; while net direct

investment was US$177.4 million compared to US$139.3 million in December 2014.

FDI continues to be an important long term source of financing for the current account for Jamaica.

For the December 2015 quarter, the ratio of net FDI inflows to the current account deficit was 244.5

per cent (Figure 14).

Flows from official and private sources were sufficient for financing the net borrowing balance on the

current and capital accounts. Consequently, gross reserves increased by US$23.6 million during the

quarter.

65.542.4

19.3 18.241.6

76.0 51.631.7

106.8

61.141.1 38.0

154.3 149.5

244.5

0

50

100

150

200

250

300

Figure 14: Financing the Current Account, Ratio of FDI/Current Account Deficit in % (no value means Current Account surplus)

FDI/Current Account Deficit

15

Glossary (BPM6)

The Sixth Edition of the Balance of Payments Manual (BPM6) format was first published in the December

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

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.

16

1. 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.

17

2. 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.

3. 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.

18

Evolution of BOP Components (% of GDP)

BALANCE OF PAYMENTS OF JAMAICA:

SUMMARY 2013Q4 2014Q1 FY 2013/14 2014Q2 2014Q3 2014Q4 2015Q1 FY 2014/15 2015Q2 2015Q3 2015Q4

Current account -3.4 -0.8 -8.1 -2.2 -2.4 -2.7 0.2 -7.1 -0.8 -1.2 -0.5

Goods and services -7.2 -4.7 -22.6 -5.7 -6.0 -6.2 -3.4 -21.3 -4.4 -4.8 -4.5

Goods -7.9 -6.3 -26.8 -6.8 -6.8 -7.1 -5.6 -26.4 -6.0 -5.8 -5.5

Exports 2.6 2.7 10.6 2.6 2.7 2.4 2.4 10.1 2.5 2.1 2.1

Imports 10.4 9.0 37.4 9.4 9.6 9.6 8.0 36.5 8.5 7.9 7.7

Services 0.7 1.6 4.3 1.1 0.8 1.0 2.2 5.0 1.6 1.0 1.0

Transport -1.3 -1.4 -5.0 -1.2 -1.2 -1.2 -1.0 -4.6 -1.1 -1.0 -1.0

Travel 3.1 4.2 13.6 3.6 3.3 3.6 4.6 15.2 3.8 3.5 3.6

Construction -0.1 -0.1 -0.4 -0.1 -0.1 -0.1 -0.1 -0.5 -0.1 -0.2 -0.2

Insurance and pension services -0.2 -0.2 -0.9 -0.3 -0.4 -0.4 -0.3 -1.3 -0.1 -0.4 -0.3

Financial services 0.0 0.0 -0.2 0.0 -0.1 -0.1 -0.1 -0.2 -0.1 -0.1 -0.1

Charges for the use of intellectual property n.i.e. -0.1 -0.1 -0.4 -0.1 -0.1 -0.1 -0.1 -0.3 -0.1 -0.1 -0.1

Telecommunications, computer, and information

services0.1 0.1 0.5 0.1 0.1 0.0 0.1 0.3 0.1 0.1 0.0

Other business services -0.8 -1.0 -3.2 -0.9 -0.8 -0.9 -1.1 -3.7 -0.9 -0.8 -0.9

Personal, cultural, and recreational services 0.1 0.1 0.5 0.1 0.1 0.1 0.1 0.5 0.1 0.1 0.1

Government goods and services n.i.e. -0.1 -0.1 -0.2 -0.1 -0.1 -0.1 -0.1 -0.2 -0.1 -0.1 -0.1

Primary income -0.6 -0.1 -1.6 -0.6 -0.6 -0.7 -0.3 -2.3 -0.9 -0.7 -0.4

o.w. Compensation of employees 0.2 0.0 0.4 0.0 0.1 0.2 0.1 0.5 0.0 0.1 0.4

o.w. Investment income -0.8 -0.2 -2.0 -0.6 -0.8 -1.0 -0.4 -2.8 -0.9 -0.8 -0.7

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 4.4 3.9 16.0 4.1 4.2 4.3 3.9 16.5 4.4 4.3 4.3

General government 0.7 0.4 1.9 0.3 0.4 0.4 0.3 1.4 0.4 0.4 0.3

Financial corporations, nonfinancial

corporations, households, and NPISHs3.7 3.5 14.2 3.7 3.8 3.9 3.6 15.0 4.0 3.9 4.0

o.w. Personal transfers (Current transfers between

resident and nonresident households) 3.4 3.3 13.2 3.5 3.5 3.6 3.4 14.0 3.7 3.6 3.7

Other current transfers 0.3 0.2 1.0 0.2 0.3 0.3 0.2 1.0 0.2 0.3 0.3

Capital account 0.0 0.0 0.0 0.0 0.0 0.0 0.1 0.1 0.0 10.5 0.0

Capital transfers 0.0 0.0 0.0 0.0 0.0 0.0 0.1 0.1 0.0 10.5 0.0

A. Current & Capital Account Balance -3.4 -0.8 -8.1 -2.2 -2.4 -2.6 0.3 -7.0 -0.8 9.3 -0.5

Net lending (+) / net borrowing (-) (balance from

current and capital account)

Net errors and omissions (B minus A ) 1.7 -2.7 -4.3 0.1 0.4 1.8 -1.2 1.2 -0.1 -3.6 -0.5

B. Financial Account Balance -3.4 -0.8 -8.1 -2.2 -2.4 -2.6 0.3 -7.0 -0.8 9.3 -0.5

Net lending (+) / net borrowing (-) (balance from

financial account)

Direct investment -1.9 -0.9 -5.2 -1.4 -1.0 -1.0 -1.4 -4.8 -1.3 -1.7 -1.3

Portfolio investment -0.5 0.0 0.1 1.1 -5.5 1.1 1.9 -1.5 2.2 -13.6 0.1

Financial derivatives (other than reserves) and

employee stock options 0.0 -0.4 0.5 -0.5 -0.4 0.0 0.0 -0.9 0.2 0.0 0.0

Other investment -0.1 -3.9 -10.0 -1.0 -0.2 0.9 -3.0 -3.3 -0.9 18.5 0.0

Reserve assets 0.7 1.6 2.3 -0.2 5.1 -1.7 1.6 4.6 -1.1 2.6 0.2

I S S N 0 7 9 9 3 2 9 3

Appendix A: Historical Balance of Payments Tables

19

Recent Five Quarters

Balance of Payments (US$MN) 2014/15:Q3 2014/15:Q4 2015/16:Q1 2015/16:Q2 2015/16:Q3

Oct-Dec Jan-Mar Apr-Jun Jul-Sep Oct-Dec

Current Account Balance -367.6 25.8 -117.0 -162.0 -72.9

Credits 1,790.6 1,814.0 1,766.0 1,711.7 1,777.7

Debits 2,158.2 1,788.2 1,883.0 1,873.8 1,850.6

Goods & Services -855.4 -473.2 -600.9 -655.5 -617.5

Exports 1,044.6 1,157.4 1,056.7 983.4 1,006.8

Imports 1,900.0 1,630.7 1,657.6 1,638.9 1,624.3

Goods -988.7 -772.3 -822.2 -797.6 -761.1

Exports 333.5 336.5 344.4 286.7 293.6

Imports 1,322.2 1,108.7 1,166.6 1,084.3 1,054.7

Services 133.3 299.0 221.3 142.2 143.6

Exports 711.1 821.0 712.3 696.7 713.2

Imports 577.9 521.9 491.0 554.6 569.6

Primary Income -102.3 -45.1 -117.7 -97.6 -52.0

Credits 95.5 54.5 56.2 73.3 111.3

Debits 197.9 99.6 173.9 170.9 163.2

Secondary Income 590.1 544.1 601.5 591.0 596.6

Credits 650.4 602.1 653.1 655.0 659.7

Debits 60.3 58.0 51.5 64.0 63.0

Capital Account 5.5 9.3 2.8 1449.7 5.0

Credits 5.5 9.3 2.8 1,449.7 5.0

Debits 0.0 0.0 0.0 0.0 0.0

Net lending (+) / net borrowing (-) (balance from current

and capital account) -362.1 35.0 -114.2 1287.6 -67.9

Financial Account

Net lending (+) / net borrowing (-) (balance from financial

account) -108.9 -124.3 -125.0 794.5 -132.1

Direct Investment -139.3 -194.4 -182.6 -235.7 -177.4

Net acquisition of financial assets 0.4 -1.0 -2.0 6.5 0.9

Net incurrence of liabilities 139.7 193.4 180.5 242.3 178.2

Portfolio Investments 145.4 266.3 302.6 -1,876.3 16.1

Net acquisition of financial assets -76.1 403.0 157.9 22.9 -75.0

Net incurrence of liabilities -221.5 136.7 -144.7 1,899.2 -91.1

Financial derivatives -1.6 -2.0 28.8 0.8 -1.2

Net acquisition of financial assets -12.4 -12.2 21.1 -1.3 -1.3

Net incurrence of liabilities -10.9 -10.1 -7.7 -2.1 -0.1

Other Investments 127.8 -410.0 -121.4 2,552.6 6.7

Net acquisition of financial assets 101.0 -269.5 111.6 -108.1 124.3

Net incurrence of liabilities -26.8 140.5 233.0 -2,660.6 117.7

Reserve Assets -241.4 215.9 -152.5 353.2 23.6

Net Errors and Omissions 253.1 -159.4 -10.8 -493.1 -64.2

Provisional



April 2016

20

Full Fiscal Year

Balance of Payments (US$MN) 2014/15:Q1 2014/15:Q2 2014/15:Q3 2014/15:Q4 2014/15

Apr-Jun Jul-Sep Oct-Dec Jan-Mar Apr-Mar 1/

Current Account Balance -303.8 -337.4 -367.6 25.8 -983.0

Credits 1,722.4 1,774.4 1,790.6 1,814.0 7,101.3

Debits 2,026.2 2,111.7 2,158.2 1,788.2 8,084.3

Goods & Services -785.1 -834.8 -855.4 -473.2 -2,948.4

Exports 1,050.1 1,050.5 1,044.6 1,157.4 4,302.7

Imports 1,835.2 1,885.3 1,900.0 1,630.7 7,251.1

Goods -939.8 -946.0 -988.7 -772.3 -3,646.8

Exports 355.9 375.0 333.5 336.5 1,400.8

Imports 1,295.7 1,321.0 1,322.2 1,108.7 5,047.6

Services 154.8 111.3 133.3 299.0 698.4

Exports 694.3 675.5 711.1 821.0 2,901.9

Imports 539.5 564.2 577.9 521.9 2,203.6

Primary Income -80.0 -86.6 -102.3 -45.1 -314.0

Credits 56.7 76.0 95.5 54.5 282.8

Debits 136.8 162.6 197.9 99.6 596.8

Secondary Income 561.3 584.0 590.1 544.1 2,279.4

Credits 615.5 647.8 650.4 602.1 2,515.7

Debits 54.2 63.8 60.3 58.0 236.3

Capital Account 1.4 1.5 5.5 9.3 17.7

Credits 1.4 1.5 5.5 9.3 17.7

Debits 0.0 0.0 0.0 0.0 0.0


ARd capital account) -302.4 -335.8 -362.1 35.0 -965.3

Financial Account


account) -283.4 -280.8 -108.9 -124.3 -797.5


Net acquisition of financial assets -3.3 0.5 0.4 -1.0 -3.4


Portfolio Investments 149.2 -763.8 145.4 266.3 -202.9

Net acquisition of financial assets 361.6 -33.3 -76.1 403.0 655.1

Net incurrence of liabilities 212.3 730.5 -221.5 136.7 858.0

Financial derivatives -66.5 -48.8 -1.6 -2.0 -118.9

Net acquisition of financial assets -73.5 -68.0 -12.4 -12.2 -166.1


Other Investments -145.1 -28.9 127.8 -410.0 -456.2

Net acquisition of financial assets 170.2 -196.4 101.0 -269.5 -194.8

Net incurrence of liabilities 315.2 -167.5 -26.8 140.5 261.3

Reserves Assets -32.1 698.7 -241.4 215.9 641.1

Net Errors and Omissions 18.9 55.0 253.1 -159.4 167.8

1/ Preliminary



April 2016

21

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 25.8 -117.0 -162.0 -72.9 -326.2

Credits 1,814.0 1,766.0 1,711.7 1,777.7 7,069.4

Debits 1,788.2 1,883.0 1,873.8 1,850.6 7,395.6

Goods & Services -473.2 -600.9 -655.5 -617.5 -2,347.1

Exports 1,157.4 1,056.7 983.4 1,006.8 4,204.3

Imports 1,630.7 1,657.6 1,638.9 1,624.3 6,551.5

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 299.0 221.3 142.2 143.6 806.1

Exports 821.0 712.3 696.7 713.2 2,943.2

Imports 521.9 491.0 554.6 569.6 2,137.1

Primary Income -45.1 -117.7 -97.6 -52.0 -312.3

Credits 54.5 56.2 73.3 111.3 295.2

Debits 99.6 173.9 170.9 163.2 607.6

Secondary Income 544.1 601.5 591.0 596.6 2,333.3

Credits 602.1 653.1 655.0 659.7 2,569.8

Debits 58.0 51.5 64.0 63.0 236.5

Capital Account 9.3 2.8 1449.7 5.0 1466.7

Credits 9.3 2.8 1,449.7 5.0 1,466.7

Debits 0.0 0.0 0.0 0.0 0.0


and capital account) 35.0 -114.2 1287.6 -67.9 1140.5

Financial Account


account) -124.3 -125.0 794.5 -132.1 413.0


Net acquisition of financial assets -1.0 -2.0 6.5 0.9 4.4


Portfolio Investments 266.3 302.6 -1,876.3 16.1 -1,291.4

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


Other Investments -410.0 -121.4 2,552.6 6.7 2,027.9

Net acquisition of financial assets -269.5 111.6 -108.1 124.3 -141.7

Net incurrence of liabilities 140.5 233.0 -2,660.6 117.7 -2,169.5

Reserves Assets 215.9 -152.5 353.2 23.6 440.2

Net Errors and Omissions -159.4 -10.8 -493.1 -64.2 -727.5

Revised



April 2016

22

Balance of Payments (US$MN) Balance of Payments (US$MN) 2015

2015 Oct-Dec 1/

Oct-Dec 1/ Current Account Balance -72.9

Credits 1,777.7

1. Current Account -72.9 Debits 1,850.6

A. Goods -761.1 Goods & Services -617.5

Exports 293.6 Exports 1,006.8

Imports 1054.7 Imports 1,624.3

Goods -761.1

B. Services 143.6 Exports 293.6

Transportation -143.8 Imports 1,054.7

Travel 500.9 Services 143.6

Other Services -213.4 Exports 713.2

Imports 569.6

C. Income -52.0 Primary Income -52.0

Compensation of Employees 50.1 Credits 111.3

Investment Income -102.0 Debits 163.2

Secondary Income 596.6

D. Current Transfers 596.6 Credits 659.7

Official 43.7 Debits 63.0

Private 552.9 Capital Account 5.0

Credits 5.0

2. Capital & Financial Account 52.7 Debits 0.0

A. Capital Account 5.0 -67.9

Capital Transfers 5.0

Official 0.0

Private 5.0 Financial Account

Acq/Disp. of Non-produced Non-fin. Assets 0.0 -132.1

B. Financial Account 47.7 Direct Investment -177.4

Direct Investment 177.4 Net acquisition of financial assets 0.9

Portfolio Investment 235.0 Net incurrence of liabilities 178.2

Other Official Investment -64.4 Portfolio Investments 16.1

Other Private Investment (incl. Errors & Omissions) -276.6 Net acquisition of financial assets -75.0

Reserves -23.6 Net incurrence of liabilities -91.1

Financial Derivatives -1.2

1/ Preliminary Net acquisition of financial assets -1.3

International Accounts Unit Net incurrence of liabilities -0.1

Economic Information & Publications Dept. Other Investments 6.7

April 2016 Net acquisition of financial assets 124.3

Net incurrence of liabilities 117.7

direct mapping Reserve Assets 23.6

change of sign on all Financial Account Items Net Errors and Omissions -64.2

1/ Preliminary



April 2016

Net lending (+) / net borrowing (-) (balance

from current and capital account)

Net lending (+) / net borrowing (-) (balance

from financial account)

-

Appendix B: Comparison of BOP Formats

Old Terminology New Terminology

Goods + Services = Goods & Services

Current a/c + Capital a/c = Net lending (+) / Net borrowing (-)

23

BANK OF JAMAICA Nethersole Place

P.O. Box 621 Kingston, Jamaica

Telephone: 876 922 0750 Internet: www.boj.org.jm

Documents

THE BALANCE OF PAYMENTS3 I. BALANCE OF PAYMENTS SUMMARY October-December 2015 Jamaica recorded a current account deficit of US$72.9 million (or 0.5 per cent of GDP) for the October