CAPITAL ACCOUNT


Graph 1. Net lending (+) / net borrowing (-), by sector, relative to GDP, seasonally adjusted


Australia has generally been a net borrower from overseas. In the national accounts, this situation is reflected by a negative value for net lending to non-residents. The last time Australia was a net lender of funds to the rest of world was in June quarter 1975. The ratio of net borrowing from overseas to GDP in September quarter 2014 was 3.2%, down from 3.5% in June quarter 2014.

In the September quarter 2014, financial corporations net lending (+) /net borrowing (-) relative to GDP was 1.5%, unchanged from a net lending position of 1.5% in June quarter. General government net borrowing relative to GDP was 3.0%, net borrowing for non-financial corporations was 4.2%, while household net lending was 2.7%.


Graph 2. Gross fixed capital formation, by sector, relative to GDP, seasonally adjusted


Gross fixed capital formation by sector represents investment in capital assets. Capital investment by non-financial corporations as a proportion of GDP started growing during the 2000s before peaking at 17.0% in the December quarter 2012. Capital investment by non-financial corporations, expressed as a share of GDP, fell in September quarter 2014 to 14.2% of GDP.

Household capital investment as a proportion of GDP remained steady at around 10% of GDP through the 2000s. Since June quarter 2008, this has fallen below 10% as growth in household gross fixed capital formation has not been as strong as growth in GDP. March quarter 2013 recorded the lowest proportion of household investment to GDP in this period, at 7.7%. In September quarter 2014, household capital investment was 8.5% of GDP.

General government capital investment as a proportion of GDP remains steady at around 3.0% with a recent peak of 4.6% in March 2010. It was 3.2% in September quarter 2014.