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1301.0 - Year Book Australia, 2009–10  
Previous ISSUE Released at 11:30 AM (CANBERRA TIME) 04/06/2010   
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Contents >> International accounts and trade >> Statistical overview

STATISTICAL OVERVIEW

Balance of payments

The balance on current account for 2008-09 was a deficit of $38.4 billion (b), a decrease of $34.1b (47%) on the previous year (table 31.2). The net income deficit fell by $5.0b (10%) with a decrease in income credits of $1.8b (4%) and a decrease in income debits of $6.8b (7%). The balance on goods and services was a surplus of $5.8b, a turnaround of $29.3b on the deficit of $23.6b recorded in 2007--08. The net goods balance was a surplus of $8.2b and the net services balance was a deficit of $2.4b.

The surplus on capital account increased by $0.1b (6%) to $2.3b in 2008--09.

The financial account recorded a net inflow of investment into Australia in 2008-09 of $37.2b. This was largely driven by net portfolio investment of $55.2b together with net direct investment of $10.9b. This was countered by net decreases in other investment of -$10.7b, reserve assets of -$11.9b and financial derivative settlements of -$6.4b.


31.2 Balance of Payments, Summary

2004-05
2005-06
2006-07
2007-08
2008-09
$m
$m
$m
$m
$m

Current account
-56 325
-52 627
-58 529
-72 504
-38 447
Goods and services
-22 626
-14 520
-12 757
-23 561
5 805
Credits
167 562
196 274
215 695
233 853
285 701
Debits
-190 188
-210 794
-228 452
-257 414
-279 896
Goods
-23 006
-15 291
-14 510
-22 346
8 214
Credits
127 867
154 425
169 514
182 818
231 728
Debits
-150 873
-169 716
-184 024
-205 164
-223 514
Services
380
771
1 753
-1 215
-2 409
Credits
39 695
41 849
46 181
51 035
53 973
Debits
-39 315
-41 078
-44 428
-52 250
-56 382
Income
-33 330
-37 458
-45 433
-48 601
-43 612
Credits
21 741
26 692
36 454
42 022
40 224
Debits
-55 071
-64 150
-81 887
-90 623
-83 836
Current transfers
-369
-649
-339
-342
-640
Credits
4 268
4 602
5 155
5 264
4 991
Debits
-4 637
-5 251
-5 494
-5 606
-5 631
Capital and financial account
57 389
53 691
59 444
70 315
39 469
Capital account
1 594
1 726
2 380
2 167
2 287
Capital transfers
1 523
1 729
1 957
2 168
2 533
Credits
2 674
2 673
2 995
3 382
4 072
Debits
-1 151
-944
-1 038
-1 214
-1 539
Net acquisition/disposal of non-produced, non-financial assets
71
-3
423
-1
-246
Financial account
55 795
51 965
57 064
68 148
37 182
Direct investment
51 494
-6 456
10 129
26 749
10 925
Abroad
59 307
-29 695
-30 616
-33 036
-44 016
In Australia
-7 813
23 239
40 745
59 785
54 941
Portfolio investment
544
62 564
63 338
-4 965
55 248
Financial derivatives
961
-3 768
3 469
-7 820
-6 372
Other investment
10 919
5 230
255
9 892
-10 722
Reserve assets
-8 123
-5 605
-20 127
44 292
-11 897
Net errors and omissions
-1 064
-1 064
-915
2 189
-1 022

Source: Balance of Payments and International Investment Position, Australia (5302.0).


Graph 31.3 shows the differing influences of the balance on goods and services (trade balance) and the net income deficit on the balance on current account. The net income deficit rose from $18.1b in 1994-95 to $43.6b in 2008-09. The underlying level of net income drives the level of the current account deficit, as Australia continues to service its external liabilities. However, the balance on goods and services has been more volatile than net income as shown by the turnarounds in early 2000 and in 2008-09.


31.3 Current account, Summary
Graph: 31.3 Current account, Summary



Ratios

The ratio of the current account deficit to gross domestic product (GDP) was -3.2% in 2008-09, a decrease on the previous year (table 31.4).

31.4 RATIOS

2004-05
2005-06
2006-07
2007-08
2008-09
%
%
%
%
%

To GDP
Current account
-6.3
-5.4
-5.6
-6.4
-3.2
Goods and services
-2.5
-1.5
-1.2
-2.1
0.5
Credits
18.7
20.3
20.6
20.7
23.9
Debits
-21.2
-21.8
-21.8
-22.7
-23.4
Income
-3.7
-3.9
-4.3
-4.3
-3.6
Net international investment position
56.4
56.0
60.1
59.7
60.6
Net foreign equity
7.9
3.7
7.2
5.2
7.7
Net foreign debt
48.5
52.3
52.9
54.5
52.9
To goods and services credits
Net investment income
-19.8
-18.9
-20.9
-20.5
-14.9
Net foreign equity
-9.9
-9.7
-9.6
-8.5
-4.8
Net foreign debt
-9.8
-9.2
-11.3
-12.0
-10.1

Source: Balance of Payments and International Investment Position, Australia (5302.0).


Exchange rates

Graph 31.5 shows movements in the annual average exchange rates for the major four currencies.

31.5 Exchange Rates, Units of foreign currency per $A(a)
Graph: 31.5 Exchange Rates, Units of foreign currency per $A(a)



International trade in goods and services (balance of payments basis)

Australia’s international trade in goods and services (chain volume measures) for the five years to 2008-09 is shown in table 31.6.

Chain volume measures of exports and imports remove the effects of price changes. They provide measures, in dollar values, which indicate changes in the actual volume of exports and imports.

The chain volume measures of Australia’s exports of goods and services increased by $4.0b (2%), and Australia’s imports of goods and services decreased by $6.5b (2%) between 2007-08 and 2008-09. In comparison, the current price value of those exports, which incorporates both volume and price changes, increased by $51.8b (22%) (table 31.2). This indicates that, on average, the prices of Australia’s exports increased more rapidly than their volumes over the period.

Table 31.6 also presents various price indexes for Australia’s trade in goods and services. The implicit price deflators (IPDs) are derived by dividing the current price measures (table 31.2) by the corresponding chain volume measures. These IPDs reflect not only price change, but also compositional effects from year to year.

Australia’s terms of trade, which is a measure of the purchasing power of its exports over imported goods and services (derived by dividing the IPD for credits by the IPD for debits) rose by 7.6% to 113.2 in 2008-09, reflecting a 20.0% rise in the IPD for goods and services credits and a 11.5% rise in the IPD for goods and services debits.
31.6 CHAIN VOLUME MEASURES, IMPLICIT PRICE DEFLATORS AND TERMS OF TRADE(a)

2004-05
2005-06
2006-07
2007-08
2008-09

Chain volume measures
Goods and services $m
8 284
-1 361
-12 757
-35 476
-24 953
Goods and services credits $m
203 408
207 887
215 695
224 500
228 526
Goods credits $m
160 337
164 308
169 515
175 092
178 265
Services credits $m
42 546
43 326
46 182
49 408
50 260
Goods and services debits $m
-195 125
-209 246
-228 452
-259 976
-253 479
Goods debits $m
-154 917
-168 016
-184 024
-205 966
-201 651
Services debits $m
-40 101
-41 250
-44 427
-54 012
-51 829
Implicit price deflators
Goods and services credits index
82.4
94.4
100.0
104.2
125.0
Goods credits index
79.7
94.0
100.0
104.4
130.0
Services credits index
93.3
96.6
100.0
103.3
107.4
Goods and services debits index
97.5
100.7
100.0
99.0
110.4
Goods debits index
97.4
101.0
100.0
99.6
110.8
Services debits index
98.0
99.6
100.0
96.7
108.7
Terms of trade
Goods and services index
84.5
93.7
100.0
105.2
113.2
Goods index
81.9
93.0
100.0
104.8
117.3
Services index
95.2
97.0
100.0
106.8
98.8

(a) Reference year for chain volume measures, price and term of trade indexes is 2006-07.
Source: Balance of Payments and International Investment Position, Australia (5302.0).



International trade in goods by commodity (merchandise trade basis)

In 2008-09 Australia’s exports of goods were worth more than goods imported. This resulted in a surplus of $11.0b, a turnaround of $32.5b on the deficit of $21.5b recorded in 2007-08.

Graph 31.7 shows the top ten commodity exports in 2008-09. In 2008-09 total exports of goods increased by $49.6b (27%) to $230.5b. The largest increases were:
  • Coal, not agglomerated, up $30.1b (123%)
  • Iron ore and concentrates, up $13.7b (67%)
  • Gold, non-monetary, up $4.8b (40%)
  • Natural gas, up $4.2b (72%).

Graph 31.8 shows the top ten commodity imports in 2008-09. In 2008-09 total imports of goods increased by $17.2b (8%) to $219.5b. The largest increases were:
  • Gold, non-monetary, up $3.9b (54%)
  • Medicaments, up $0.9b (14%).

The largest decreases were:
  • Passenger motor vehicles, down $3.5b (23%)
  • Crude petroleum oils, down $2.3b (14%).
31.7 MERCHANDISE EXPORTS OF MAJOR COMMODITIES, ^By commodity group(a)
Graph: 31.7 MERCHANDISE EXPORTS OF MAJOR COMMODITIES, ^By commodity group(a)


31.8 MERCHANDISE IMPORTS OF MAJOR COMMODITIES, ^By commodity group(a)
Graph: 31.8 MERCHANDISE IMPORTS OF MAJOR COMMODITIES, ^By commodity group(a)



International trade in goods by country (merchandise trade basis)

For exports, country refers to the country to which the goods were consigned at the time of export. For imports, country refers to the country of origin of the goods, that is, where the majority of processing of the goods took place. Table 31.9 shows merchandise exports to Australia's ten main destinations; table 31.10 shows merchandise imports from the ten main countries of origin, in 2008-09.

In 2008-09 Australia recorded a merchandise trade surplus of $11.0b. The following major trading partners were the main contributors to the overall surplus:
  • Japan - trade surplus of $34.7b, up $19.4b due to a $17.6b increase in exports. Contributing to the increase in exports were coal, coke and briquettes (up $12.5b) and metalliferous ores and metal scrap (up $2.1b).
  • India - trade surplus of $13.3b, up $5.6b due to a $6.1b increase in exports. Contributing to the increase in exports were coal, coke and briquettes (up $4.0b) and non-monetary gold (up $1.7b).
  • Republic of (South) Korea - trade surplus of $12.7b, up $4.6b due to a $5.0b increase in exports. Contributing to the increase in exports were coal, coke and briquettes (up $4.6b) and metalliferous ores and metal scrap (up $0.9b).
  • Taiwan - trade surplus of $4.1b, up $1.7b due to a $1.7b increase in exports. Contributing to the increase in exports were coal, coke and briquettes (up $1.5b) and metalliferous ores and metal scrap (up $0.2b).

In 2008-09 Australia recorded a merchandise trade deficit with a number of countries, the largest of which were:
  • United States of America - trade deficit of $13.7b, a small increase on the previous year’s deficit.
  • Germany - trade deficit of $8.9b, a decrease of $0.2b on the previous year's deficit, with a $0.8b increase in exports and $0.5b increase in imports.
31.9 INTERNATIONAL MERCHANDISE EXPORTS, Top 10 Countries - 2008-09

Value (FOB)
Percentage share of Value (FOB)
Average annual growth over five years
$m
%
%

Japan
52 547
22.8
21.5
China
39 302
17.1
31.7
Korea, Republic of (South)
19 207
8.3
17.7
India
15 434
6.7
26.0
United States of America
11 598
5.0
4.1
United Kingdom
11 510
5.0
17.5
New Zealand
8 553
3.7
1.1
Taiwan
8 156
3.5
17.1
Singapore
5 508
2.4
12.5
Thailand
4 939
2.1
14.9

Source: International Trade in Goods and Services, Australia (5368.0).

31.10 INTERNATIONAL MERCHANDISE IMPORTS, Top 10 Countries - 2008-09

Value (Customs Value)
Percentage share of Value (Customs Value)
Average annual growth over five years
$m
%
%

China
37 046
16.9
19.3
United States of America
25 342
11.5
4.9
Japan
17 838
8.1
2.1
Singapore
13 463
6.1
21.4
Germany
11 106
5.1
6.8
Thailand
10 753
4.9
24.0
United Kingdom
9 024
4.1
10.7
Malaysia
8 325
3.8
12.1
New Zealand
7 042
3.2
6.9
Korea, Republic of (South)
6 521
3.0
6.0

Source: International Trade in Goods and Services, Australia (5368.0).



International trade in services

Table 31.11 provides details of Australia’s international trade in services, by service type.

During the period 2004-05 to 2006-07 Australia recorded annual surpluses on its international trade in services. However for 2007-08 and 2008-09 Australia recorded annual deficits. The 2008-09 services deficit increased $1.2b (98%), with an increase in exports of $2.9b (6%) and an increase in imports of $4.1b (8%). The major contributors to services exports in 2008-09 were personal travel services, of which over half were education-related; transportation services; passenger transportation services; and miscellaneous business, professional and technical services. The major contributors to services imports were personal travel services, miscellaneous business, professional and technical services, freight services, and passenger transportation services.

31.11 INTERNATIONAL TRADE IN SERVICES, By service type

2004-05
2005-06
2006-07
2007-08
2008-09
$m
$m
$m
$m
$m

EXPORTS

Transportation services
8 002
8 208
8 617
9 247
8 126
Passenger(a)
4 144
4 104
4 237
4 118
3 705
Freight
704
608
609
637
588
Other
3 154
3 496
3 771
4 492
3 833
Travel services
21 440
22 624
25 161
28 252
30 959
Business
1 725
2 085
2 514
2 710
2 687
Personal
19 715
20 539
22 647
25 542
28 272
Communications services(b)
831
834
801
746
981
Construction services
106
134
136
24
120
Insurance services
684
704
704
724
747
Financial services
998
1 002
1 004
1 035
1 080
Computer and information services
1 251
1 198
1 482
1 586
1 818
Royalties and licence fees
706
772
887
777
831
Other business services
4 263
4 840
5 934
7 111
7 671
Merchanting and other trade-related
653
729
782
956
1 080
Operational leasing
19
35
88
87
129
Miscellaneous business, professional and technical
3 591
4 076
5 064
6 068
6 462
Personal, cultural and recreational
547
659
607
685
792
Government services n.i.e.
867
874
848
848
848
Total
39 695
41 849
46 181
51 035
53 973

IMPORTS

Transportation services
-13 796
-14 508
-15 360
-16 380
-15 874
Passenger(a)
-5 780
-6 284
-6 876
-7 278
-6 336
Freight
-7 500
-7 776
-8 036
-8 600
-8 933
Other
-516
-448
-448
-502
-605
Travel services
-14 507
-15 090
-15 934
-20 153
-22 161
Business
-2 472
-2 512
-2 601
-3 114
-2 842
Personal
-12 035
-12 578
-13 333
-17 039
-19 319
Communication services(b)
-842
-829
-864
-971
-1 434
Construction services
-
-
-
-
-
Insurance services
-872
-900
-900
-932
-969
Financial services
-527
-581
-600
-620
-648
Computer and information services
-1 095
-1 067
-1 427
-1 478
-1 665
Royalties and licence fees
-2 482
-2 734
-3 185
-3 516
-3 540
Other business services
-3 314
-3 488
-4 203
-6 193
-7 851
Merchanting and other trade-related
-200
-188
-209
-224
-207
Operational leasing
-698
-769
-867
-843
-795
Miscellaneous business, professional and technical
-2 416
-2 531
-3 127
-5 126
-6 849
Personal, cultural and recreational services
-1 120
-1 080
-1 107
-1 159
-1 392
Government services n.i.e.
-760
-801
-848
-848
-848
Total
-39 315
-41 078
-44 428
-52 250
-56 382

- nil or rounded to zero (including null cells)
(a) Passenger transportation services includes agency fees and commission receipts for air transport.
(b) Communication services includes other services n.i.e..
Source: Balance of Payments and International Investment Position, Australia (5302.0).


Tables 31.12 and 31.13 show Australia's main trading partners for exports and imports of services in 2007-08.

31.12 SERVICES EXPORTS, Top 10 Countries - 2007-08

Value
Percentage share of value
Average annual growth over five years
$m
%
%

United States of America
5 871
11.5
2.7
United Kingdom
4 723
9.3
2.2
China
4 433
8.7
20.8
Singapore
4 131
8.1
13.0
New Zealand
3 475
6.8
6.7
India
2 524
4.9
37.9
Japan
2 498
4.9
-5.2
Korea, Republic of (South)
1 887
3.7
13.7
Hong Kong
1 627
3.2
-0.2
Malaysia
1 460
2.9
7.1

Source: International Trade in Goods and Services, Australia (5368.0).

31.13 SERVICES IMPORTS, Top 10 Countries - 2007-08

Value
Percentage share of value
Average annual growth over five years
$m
%
%

United States of America
8 871
17.0
7.3
Singapore
4 886
9.4
15.2
United Kingdom
4 168
8.0
1.6
New Zealand
2 501
4.8
4.4
Japan
2 467
4.7
5.5
Hong Kong
1 842
3.5
4.1
Thailand
1 841
3.5
20.2
China
1 398
2.7
7.7
Germany
1 272
2.4
1.0
Switzerland
1 063
2.0
0.4

Source: International Trade in Goods and Services, Australia (5368.0).


In 2007-08 Australia recorded a deficit on its trade in services with its major services trading partner, the United States of America, and a small surplus with the United Kingdom. Deficits were recorded for most European trading partners, while surpluses were recorded with a number of Asian trading partners, most notably China, India and the Republic of (South) Korea.


International investment position

Australia’s net international investment position is the difference between the levels of Australia’s foreign financial liabilities and the levels of its foreign financial assets. Historically, Australia has had a net liability position with the rest of the world.

Graph 31.14 shows the components of Australia's international investment position, indicating that the growth in Australia's net international liabilities between 30 June 1999 and 30 June 2009 is mostly due to a rise in Australia's net foreign debt. At 30 June 2009 Australia's net foreign liabilities of $725.9b were comprised of net foreign debt of $633.2b and net foreign equity of $92.7b.

31.14 NET INTERNATIONAL INVESTMENT POSITION - 30 June
Graph: 31.14 NET INTERNATIONAL INVESTMENT POSITION—30 June

31.15 LEVELS OF FOREIGN DEBT - 30 June

2005
2006
2007
2008
2009
$m
$m
$m
$m
$m

Foreign debt assets(a)
-286 811
-349 936
-441 485
-479 903
-556 764
Public sector
-73 023
-82 725
-97 895
-57 601
-83 145
Private sector
-213 788
-267 211
-343 590
-422 302
-473 619
Foreign debt liabilities(a)
722 135
856 291
994 650
1 096 553
1 189 939
Public sector
83 606
88 451
81 374
89 500
113 614
Private sector
638 529
767 840
913 277
1 007 054
1 076 324
Net foreign debt
435 324
506 355
553 165
616 650
633 174
Public sector
10 583
5 726
-16 522
31 899
30 469
Private sector
424 741
500 629
569 687
584 751
602 705

(a) Foreign debt levels between direct investors and direct investment enterprises are recorded on a gross basis for assets and liabilities.
Source: Balance of Payments and International Investment Position, Australia (5302.0).

31.16 Levels of australian investment abroad and foreign investment in Australia - 30 June

2005
2006
2007
2008
2009
$m
$m
$m
$m
$m

Levels of Australian investment abroad
-608 852
-791 618
-968 687
-1 002 741
-1 009 242
Direct investment abroad(a)
-198 820
-272 102
-316 844
-318 218
-303 893
Portfolio investment assets
-230 606
-310 169
-397 863
-408 829
-362 866
Financial derivative assets
-36 813
-42 326
-51 132
-90 179
-87 932
Other investment assets
-86 444
-103 206
-123 165
-149 660
-202 241
Reserve assets
-56 170
-63 815
-79 682
-35 856
-52 311
Levels of foreign investment in Australia
1 115 291
1 333 491
1 596 816
1 678 611
1 735 133
Direct investment in Australia(b)
274 482
301 158
351 246
391 596
408 080
Portfolio investment liabilities
654 008
825 903
1 000 261
974 964
966 944
Financial derivative liabilities
40 016
37 133
62 234
97 051
91 514
Other investment liabilities
146 784
169 296
183 076
215 000
268 594

(a) Net direct investment abroad, after deduction of liabilities to direct investment enterprises abroad.
(b) Net direct investment in Australia, after deduction of claims of Australian direct investment enterprises on direct investors.
Source: Balance of Payments and International Investment Position, Australia (5302.0).


Table 31.17 provides a reconciliation between opening and closing levels for foreign financial assets, foreign financial liabilities and Australia’s net international investment position for the past three financial years. Increases and decreases in these assets and liabilities are due to financial transactions (investment flows), price changes, exchange rate changes and other adjustments.

31.17 INTERNATIONAL INVESTMENT POSITION

CHANGES IN POSITION REFLECTING

Position at beginning of period
Transactions
Price changes
Exchange rate changes
Other adjustments
Position at end of period(a)
$m
$m
$m
$m
$m
$m

NET INTERNATIONAL INVESTMENT POSITION

Total
2006-07
541 873
57 066
16 673
12 992
-472
628 129
2007-08
628 129
68 149
-31 431
11 321
-298
675 870
2008-09
675 870
37 180
-18 642
31 454
29
725 890
Equity
2006-07
35 518
-6 214
16 831
29 086
-258
74 964
2007-08
74 964
-28 184
-20 966
33 433
-28
59 220
2008-09
59 220
66 269
11 218
-43 279
-712
92 716
Debt
2006-07
506 355
63 280
-158
-16 095
-215
553 165
2007-08
553 165
96 333
-10 467
-22 113
-269
616 650
2008-09
616 650
-29 088
-29 860
74 733
740
633 174

FOREIGN ASSETS(b)

Total
2006-07
-830 906
-144 355
-66 596
25 155
138
-1 016 566
2007-08
-1 016 566
-90 534
31 906
26 764
-182
-1 048 612
2008-09
-1 048 612
-63 398
133 633
-73 055
-108
-1 051 539
Equity
2006-07
-480 970
-63 539
-59 590
29 086
-66
-575 081
2007-08
-575 081
-67 233
40 245
33 433
-75
-568 709
2008-09
-568 709
-19 563
136 858
-43 279
-82
-494 774
Debt
2006-07
-349 936
-80 816
-7 006
-3 931
205
-441 485
2007-08
-441 485
-23 301
-8 340
-6 671
-107
-479 903
2008-09
-479 903
-43 835
-3 225
-29 777
-26
-556 764

FOREIGN LIABILITIES(c)

Total
2006-07
1 372 779
201 420
83 270
-12 163
-611
1 644 695
2007-08
1 644 695
158 683
-63 337
-15 442
-116
1 724 482
2008-09
1 724 482
100 578
-152 277
104 508
135
1 777 429
Equity
2006-07
516 488
57 326
76 421
-
-190
650 045
2007-08
650 045
39 048
-61 210
-
46
627 929
2008-09
627 929
85 832
-125 641
-
-630
587 490
Debt
2006-07
856 291
144 095
6 847
-12 163
-420
994 650
2007-08
994 650
119 633
-2 127
-15 442
-162
1 096 553
2008-09
1 096 553
14 747
-26 634
104 508
765
1 189 939

- nil or rounded to zero (including null cells)
(a) Estimates differ from those in table 30.17 due to compilation at diffeent points in time.
(b) Assets include claims of Australian direct investment enterprises on direct investors abroad, which are classified as part of direct investment in Australia.
(c) Liabilities include liabilities of Australian direct investors to direct investment enterprises abroad, which are classified as part of direct investment abroad.
Source: Balance of Payments and International Investment Position, Australia (5302.0).



Foreign debt

Australia's foreign debt liabilities include borrowing from non-residents and other non-equity liabilities to non-residents such as derivatives positions with a negative market value. Foreign debt assets include lending to non-residents and other non-equity assets such as derivatives positions with a positive market value. The majority of public sector debt assets are held by the Reserve Bank of Australia as reserve assets.

Table 31.15 shows foreign debt assets and liabilities and net foreign debt attributable to the public sector (general government plus public financial and non-financial corporations) versus the private sector. At 30 June 2009 the public sector was in a net debt liability position with non-residents of $30.5b. Of total private sector net foreign debt of $602.7b at 30 June 2009, private financial corporations accounted for $437.1b and private non-financial corporations accounted for $165.6b.


Levels of foreign investment in Australia and Australian investment abroad

In table 31.16, levels of investment are categorised by direction (Australian investment abroad and foreign investment in Australia) and functional category (direct, portfolio, financial derivatives, other and reserve assets).

Direct investment is a category of international investment that reflects the objective of obtaining a lasting interest by a resident in one economy in an enterprise in another economy, and implies a significant degree of influence by the investor in the management of the enterprise. A foreign direct investment relationship is established when an investor, who is a resident in one economy, holds 10% or more of the ordinary shares or voting stock of an enterprise (direct investment enterprise) in another economy. The portfolio investment category covers investment in equity where the investor holds less than 10% of the ordinary shares or voting stock of an enterprise and investment in debt securities. The remaining categories are financial derivatives, other investment and reserve assets (in the case of Australian investment abroad).

The level of Australian investment abroad rose $6.5b over 2008-09, while the level of foreign investment in Australia rose $56.5b over the same period. The difference largely mirrors the increase in the net International Investment Position (table 31.17). However, the items ‘Australian investment abroad’ and ‘Foreign investment in Australia’, in table 31.16, do not equate exactly with foreign assets and liabilities respectively, in table 31.17. The difference is due to netting off of assets and liabilities in regard to direct investment, both abroad and in Australia. In table 31.16, debt claims by direct investment enterprises on their direct investors are netted off against liabilities to direct investors (footnotes (a) and (b)). These items are not netted off in table 31.17.


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