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5352.0 - International Investment Position, Australia: Supplementary Country Statistics, 2005  
Previous ISSUE Released at 11:30 AM (CANBERRA TIME) 09/08/2006   
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Additional Information

Seven new data cubes, tables 11 to 17, reporting on Portfolio investment statistics have now been finalised and released on Friday 23 March 2007.


Four additional data cubes have been released on Tuesday 3 October 2006. Tables 7 to 10, reporting on Foreign Direct Investment by Industry Division.


Re-issue


The ABS identified that there was an error in the text of the original issue of this publication concerning the analysis under the 'Australian Investment Abroad - transactions' heading. The quoted total transactions were incorrect, resulting in the analysis of the destination countries and countries from which investment was withdrawn being reversed (although the percentages were correct). The error also appeared in the accompanying graph. The error did not impact the tables or the data cubes. The 'Analysis and Comments' and the PDF file have now been corrected and re-issued.




NOTES


ABOUT THE PUBLICATION

International Investment Position, Australia: Supplementary Country Statistics (cat. no. 5352.0) presents statistics on Australia’s international investment position by selected countries, which supplements the quarterly publication, Balance of Payments and International Investment Position, Australia (cat. no. 5302.0). For foreign investment in Australia (liabilities), it includes details of country of investor, investment stocks (level of investment), flows (transactions) and associated income. For Australian investment abroad (assets), similar detail is provided in respect of country of investment. The non-transaction changes which occur due to exchange rate effects, other price effects and other changes in the levels of these assets and liabilities that are not due to transactions are not shown in this publication but do contribute to the level of investment.


The statistics are presented as time series for the years 2001, 2002, 2003, 2004 and 2005 inclusive and are consistent with those to be published in the June quarter 2006 issue of Balance of Payments and International Investment Position, Australia (cat. no. 5302.0).



CHANGES IN THIS ISSUE

East Timor has been renamed Timor Leste.


The data cubes released in association in with this publication contain data for all individual counterparty countries as well as for the groups shown in the publication. The data cubes can be accessed from the Details tab for this publication on the ABS website <www.abs.gov.au>.



SIGNIFICANT EVENTS

In 2004, significant restructures of enterprises impacted on components of Australia's international investment position (IIP) and the financial account and investment income in the current account of the balance of payments. At least one of the restructures was not completed in 2004 and there was a further impact on Australia's international accounts statistics in 2005. The impact specifically affects the equity components of Direct Investment Abroad and Direct Investment in Australia in the IIP and the Financial Account, and (to a lesser extent) the income on equity components of Investment Income in the Current Account. There was no net impact on the IIP, Financial Account and Current Account.


Further information on the conceptual treatment of restructures of Australian enterprises is available on request.



REVISIONS

Incorporation of the latest survey and administrative data has resulted in revisions to International Investment data back to calendar year 2002.



ROUNDING

Discrepancies may occur between totals in this publication and the same aggregates from other sources, and between sums of component items and totals due to rounding.



INQUIRIES

For further information about these and related statistics, contact the National Information and Referral Service on 1300 135 070 or Wendy Raedt on Canberra (02) 6252 6171.



SUMMARY COMMENTARY


ANALYSIS AND COMMENTS


INTERNATIONAL INVESTMENT POSITION

Australia’s net international investment position at 31 December 2005 was $529.9 billion, an increase of $49.4 billion on the previous year.


Level of foreign investment in Australia

The level of foreign investment in Australia increased by $71.1 billion in 2005 to reach $1210.0 billion at 31 December 2005. Portfolio investment accounted for $730.5 billion (60%), direct investment for $281.1 billion (23%), other investment liabilities for $160.4 billion (13%) and financial derivatives for $38.0 billion (3%). Of the portfolio investment liabilities, debt securities accounted for $491.4 billion (67%) and equity securities for $239.1 billion (33%).


The leading investor countries at 31 December 2005 were:

  • United States of America ($325.3 billion or 27%)
  • United Kingdom ($294.7 billion or 24%)
  • Japan ($53.3 billion or 4%)
  • Hong Kong (SAR of China) ($31.3 billion or 3%)
  • Netherlands ($29.8 billion or 2%)
  • Belgium and Luxembourg ($28.0 billion or 2%)
  • Switzerland ($25.1 billion or 2%)

In addition, the level of borrowing raised on international capital markets (e.g. Eurobonds) was $134.0 billion or 11%.


The following graph illustrates the percentage share, by leading countries, of the total level of foreign investment in Australia at 31 December 2005.

FOREIGN INVESTMENT IN AUSTRALIA, LEVELS, 31 December 2005
Graph: Foreign Investment in Australia, Levels, 31 December 2005



Level of Australian investment abroad

The level of Australian investment abroad reached $680.2 billion at 31 December 2005, an increase of $21.7 billion on the previous year. Direct investment abroad accounted for $241.4 billion (35%), portfolio investment for $252.8 billion (37%), other investment for $89.3 billion (13%), reserve assets for $59.0 billion (9%) and financial derivatives for $37.7 billion (6%). Equity has been the main form of Australian investment abroad during the past decade. At $409.7 billion, equity represented 60% of the total level of investment at 31 December 2005.


The leading destination countries as at 31 December 2005 were:

  • United States of America ($291.0 billion or 43%)
  • United Kingdom ($96.1 billion or 14%)
  • New Zealand ($58.9 billion or 9%)
  • Japan ($31.6 billion or 5%)
  • Netherlands ($25.8 billion or 4%).

The following graph illustrates the percentage share, by leading countries, of the total level of Australian investment abroad at 31 December 2005.

AUSTRALIAN INVESTMENT ABROAD, LEVELS, 31 December 2005
Graph: Australian Investment Abroad, Levels, 31 December 2005




FINANCIAL ACCOUNT TRANSACTIONS

The balance on financial account for the year ended 31 December 2005 recorded a net inflow (surplus) of $52.6 billion. This result is up $1.7 billion on the net inflow of $50.9 billion recorded for the previous year.


Foreign investment in Australia - Transactions

Foreign investment in Australia recorded a net inflow of $29.4 billion for the year ended 31 December 2005, a decrease of $53.3 billion on the net inflow of $82.7 billion for the previous year.


The leading investor countries were:

  • Germany ($4.1 billion or 14%)
  • Switzerland ($3.0 billion or 10%)
  • Netherlands ($2.4 billion or 8%).

Countries to which large amounts of foreign investment were withdrawn in 2005 were:
  • United States of America ($47.4 billion or -161%)
  • United Kingdom ($3.0 billion or -10%)

In addition, issues of borrowing raised on international capital markets (e.g. Eurobonds) were $29.5 billion or 100%.


The following graph illustrates the percentage share, by leading countries, of total financial transactions for foreign investment in Australian during the year ended 31 December 2005.

FOREIGN INVESTMENT IN AUSTRALIA, TRANSACTIONS, 2005
Graph: Foreign Investment in Australia, Transactions, 2005

Australian investment abroad - Transactions

Australian investment abroad recorded a net inflow of $23.2 billion for the year ended 31 December 2005, a turnaround of $55.0 billion on the net outflow of $31.8 billion for the previous year.

The leading destination countries were:
  • New Zealand ($7.5 billion or 32%)
  • Japan ($3.9 billion or 17%)
  • Canada ($3.3 billion or 14%).

Countries from which large amounts of Australian investment were withdrawn in 2005 were:
  • United Kingdom ($21.6 billion or -93%)
  • United States of America ($17.0 billion or -73%)
  • Singapore ($8.6 billion or -37%)
  • Cayman Islands ($7.3 billion or -32%)
  • Hong Kong (SAR of China) ($2.3 billion or -10%).

The following graph illustrates the percentage share, by leading countries, of total financial transactions for Australian investment abroad during the year ended 31 December 2005.

Graph: Australian Investment Abroad, Transactions, 2005

INCOME

Income debits totalled $55.8 billion for the year ended 31 December 2005. This result is up $9.9 billion on the income debits in the previous year. The main countries to which income accrued for the year ended 31 December 2005:
  • United States of America ($14.6 billion or 26%)
  • United Kingdom ($9.1 billion or 16%)
  • Japan ($4.8 billion or 9%).

Income credits totalled $20.1 billion for the year ended 31 December 2005. This result is up $1.9 billion on the income credits in the previous year. The main countries from which income accrued for the year ended 31 December 2005 were:
  • United States of America ($7.8 billion or 39%)
  • New Zealand ($3.6 billion or 18%)
  • United Kingdom ($2.2 billion or 11%).

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