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1301.0 - Year Book Australia, 2008  
Previous ISSUE Released at 11:30 AM (CANBERRA TIME) 07/02/2008   
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Contents >> International accounts >> Statistical overview

STATISTICAL OVERVIEW

Balance of payments

The balance on current account for 2006-07 was a deficit of $59.2 billion (b), an increase of $5.3b (10%) on the previous year (table 31.2). The net income deficit rose $7.8b (20%) with an increase in income debits of $15.7b (25%) partly offset by an increase in income credits of $7.9b (32%). The deficit on goods and services was $12.0b, a decrease of $2.5b (17%) on the 2005-06 deficit of $14.5b. The net goods deficit fell by $1.5b (10%) and the net services surplus rose by $1.0b (128%) on the previous year.

The surplus on capital account increased by $0.7b (53%) to $2.1b in 2006-07.

The financial account recorded a net inflow of investment into Australia in 2006-07 of $57.2b. This was largely driven by net portfolio investment of $76.7b balanced by an increase in reserve assets of $20.1b. Net direct investment was largely unchanged, as a result of a significant increase in Australian direct investment abroad being almost totally matched by increased foreign direct investment in Australia in 2006-07.

31.2 BALANCE OF PAYMENTS, Summary

2002-03
2003-04
2004-05
2005-06
2006-07
$m
$m
$m
$m
$m

Current account
-38 362
-45 980
-55 479
-53 884
-59 189
Goods and services
-15 946
-21 509
-22 626
-14 520
-12 033
Credits
151 790
147 205
167 562
196 274
215 850
Debits
-167 736
-168 714
-190 188
-210 794
-227 883
Goods
-18 470
-23 559
-23 006
-15 291
-13 790
Credits
115 803
109 459
127 867
154 425
169 617
Debits
-134 273
-133 018
-150 873
-169 716
-183 407
Services
2 524
2 050
380
771
1 757
Credits
35 987
37 746
39 695
41 849
46 233
Debits
-33 463
-35 696
-39 315
-41 078
-44 476
Income
-22 202
-24 202
-32 407
-38 887
-46 712
Credits
15 866
17 111
21 127
24 981
32 873
Debits
-38 068
-41 313
-53 534
-63 868
-79 585
Current transfers
-214
-269
-446
-477
-444
Credits
4 233
4 273
4 269
4 313
4 261
Debits
-4 447
-4 542
-4 715
-4 790
-4 705
Capital and financial account
38 460
45 782
56 353
54 642
59 259
Capital account
991
1 095
1 212
1 355
2 075
Capital transfers
1 103
1 167
1 141
1 358
1 589
Credits
2 404
2 571
2 674
2 673
2 998
Debits
-1 301
-1 404
-1 533
-1 315
-1 409
Net acquisition/disposal of non-produced, non-financial assets
-112
-72
71
-3
486
Financial account
37 469
44 687
55 141
53 286
57 185
Direct investment
10 739
-15 926
44 949
-14 140
-44
Abroad
-9 636
-26 225
54 715
-31 920
-35 165
In Australia
20 375
10 299
-9 766
17 780
35 121
Portfolio investment
17 498
82 458
4 784
68 251
76 669
Financial derivatives
-1 036
-2 800
3 461
-578
2 907
Other investment
15 888
-13 918
10 070
5 359
-2 221
Reserve assets
-5 620
-5 127
-8 123
-5 605
-20 127
Net errors and omissions
-98
198
-874
-758
-70

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 $12.7b in 1992-93 to $46.7b in 2006-07. The underlying level of net income drives the level and direction of the current account deficit, as Australia continues to service its external liabilities. The trade deficit increased from $2.1b in 1992-93 to $12.0b in 2006-07 but fluctuated quite significantly over this period.

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 5.8% in 2006-07, an increase on the previous year (table 31.4).

31.4 RATIOS

2002-03
2003-04
2004-05
2005-06
2006-07
%
%
%
%
%

To GDP
Current account
-4.9
-5.5
-6.2
-5.6
-5.8
Goods and services
-2.0
-2.6
-2.5
-1.5
-1.2
Credits
19.4
17.5
18.7
20.3
21.1
Debits
-21.5
-20.1
-21.2
-21.8
-22.2
Income
-2.8
-2.9
-3.6
-4.0
-4.6
Net international investment position(a)
53.2
53.9
56.4
57.2
62.7
Net foreign equity
7.5
7.6
8.4
5.4
9.6
Net foreign debt
45.7
46.4
48.0
51.8
53.1
To goods and services credits
Net investment income
-14.3
-15.6
-19.0
-19.1
-20.7
Net foreign equity
-6.7
-7.1
-9.8
-9.9
-9.7
Net foreign debt
-7.7
-8.5
-9.2
-9.2
-11.0

(a) These ratios are derived by expressing net foreign liabilities at end of year as a percentage of GDP at current prices for that year.
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 2006-07 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 $6.6b (4%), and Australia's imports of goods and services increased by $19.4b (10%) between 2005-06 and 2006-07. In comparison, the current price value of those exports, which incorporates both volume and price changes, increased by $19.6b (10%) (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 7.2% to 118.9 in 2006-07, reflecting a 5.8% rise in the IPD for goods and services credits and a 1.4% fall in the IPD for goods and services debits.

31.6 CHAIN VOLUME MEASURES, Implicit price deflators and terms of trade(a)

2002-03
2003-04
2004-05
2005-06
2006-07

Chain volume measures
Goods and services $m
9 158
-7 009
-22 627
-32 674
-45 458
Goods and services credits $m
159 183
162 583
167 562
171 275
177 884
Goods credits $m
122 663
124 155
127 867
130 836
134 695
Services credits $m
37 785
38 886
39 695
40 438
43 188
Goods and services debits $m
-150 025
-169 591
-190 188
-203 947
-223 341
Goods debits $m
-119 554
-133 527
-150 874
-163 500
-179 683
Services debits $m
-30 404
-36 017
-39 314
-40 447
-43 657
Implicit price deflators
Goods and services credits index
95.4
90.5
100.0
114.6
121.3
Goods credits index
94.4
88.2
100.0
118.0
125.9
Services credits index
95.2
97.1
100.0
103.5
107.0
Goods and services debits index
111.8
99.5
100.0
103.4
102.0
Goods debits index
112.3
99.6
100.0
103.8
102.1
Services debits index
110.1
99.1
100.0
101.5
101.9
Terms of trade
Goods and services index
85.3
91.0
100.0
110.9
118.9
Goods index
84.1
88.5
100.0
113.7
123.4
Services index
86.5
97.9
100.0
101.9
105.1

(a) Reference yeat for chain volume measures, price and terms of trade indexes is 2004–05.
Source: Balance of Payments and International Investment Position, Australia (5302.0).

International trade in goods by commodity (merchandise trade basis)

In 2006-07 Australia's imports of goods were worth more than goods exported. This resulted in a $12.6b deficit. However, as the value of exports grew faster than imports, the deficit in 2006-07 was less than 2005-06 when there was a record deficit of $15.0b.

Graph 31.7 shows the top ten commodity exports in 2006-07. In 2006-07 total exports of goods increased by $15.7b (10%) to $168.2b. The largest increases were:
  • Gold, non-monetary, up $3.3b (46%)
  • Iron ore and concentrates, up $2.6b (21%)
  • Crude petroleum oils, up $1.6b (27%)
  • Ores and concentrates of base metals, up $1.3b (42%).

Graph 31.8 shows the top ten commodity imports in 2006-07. In 2006-07 total imports of goods increased by $13.3b (8%) to $180.8b. The largest increases were:
  • Passenger motor vehicles, up $1.2b (10%)
  • Motor vehicles for the transport of goods, up $0.9b (21%)
  • Pumps for gas, up $0.8b (53%)
  • Automatic data processing machines, up $0.7b (12%).
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 2006-07.

In 2006-07 Australia recorded a merchandise trade deficit of $12.6b. The following major trading partners were the main contributors to the overall deficit:
  • United States of America - trade deficit of $15.1b, an increase of $2.1b on the previous year's deficit largely due to a $2.2b increase in imports. The main commodities contributing to the increase in imports were office machines and automatic data processing machines (up $0.4b), miscellaneous manufactured articles, n.e.s. (up $0.4b) and road vehicles (up $0.3b).
  • Germany - trade deficit of $7.8b, an increase on the previous year's deficit due to a $0.6b increase in imports. The main commodity contributing to the increase in imports from Germany was road vehicles (up $0.4b).
  • Singapore - trade deficit of $5.5b, a decrease of $0.8b on the previous year's deficit due to $0.4b increase in exports and a $0.4b decrease in imports. The main commodities contributing to the increase in exports were petroleum products and related materials (up $0.3b) and non-monetary gold (up $0.2b). These same commodities also contributed to the decrease in imports with petroleum products and related materials (down $0.4b) and non-monetary gold (down $0.2b).
  • China - trade deficit of $4.3b, a decrease of $0.8b on the previous year’s deficit due to a $4.7b increase in exports partly offset by a $3.9b increase in imports. The main commodities contributing to the increase in exports were metalliferous ores and metal scrap (up $2.0b) and non ferrous metals (up $0.3b). The commodities with the largest increase in imports were telecommunications and sound recording and reproducing apparatus and equipment (up $0.6b) and miscellaneous manufactured articles, n.e.s. (up $0.4b).
In 2006-07 Australia recorded a merchandise trade surplus with a number of countries, the largest of which were:
  • Japan - trade surplus of $15.2b, up $1.5b due to a $1.5b increase in exports. Contributing to the increase in exports were metalliferous ores and metal scrap (up $1.0b) and non ferrous metals (up $0.7b).
  • India - trade surplus of $8.8b, up $2.6b due to a $2.7b increase in exports. Contributing to the increase in exports were non-monetary gold (up $2.0b), metalliferous ores and metal scrap (up $0.2b) and non-ferrous metals (up $0.2b).

31.9 MERCHANDISE EXPORTS, Major countries of destination - 2006-07

Value
Share of total exports
Average annual change(a)
$m
%
%

Japan
32 627
19.4
7.4
China
22 845
13.6
23.9
Korea, Republic of (South)
13 071
7.8
5.9
India
10 099
6.0
32.0
United States of America
9 821
5.8
-3.9
New Zealand
9 453
5.6
4.3
Taiwan
6 192
3.7
5.1
United Kingdom
6 160
3.7
3.4
Singapore
4 625
2.7
-1.3
Thailand
4 260
2.5
13.2

(a) In the 5-year period 2001-02 to 2006-07.
Source: International Trade in Goods and Services, Australia (5368.0).


31.10 MERCHANDISE IMPORTS, Major countries
of origin - 2006-07

Value
Share of total imports
Average annual change(a)
$m
%
%

China
27 138
15.0
19.2
United States of America
24 927
13.8
3.0
Japan
17 409
9.6
2.4
Singapore
10 135
5.6
20.6
Germany
9 274
5.1
6.6
United Kingdom
7 402
4.1
3.5
Thailand
7 210
4.0
20.1
Malaysia
6 625
3.7
11.4
Korea, Republic of (South)
6 010
3.3
4.9
New Zealand
5 605
3.1
3.4

(a) In the 5-year period 2001-02 to 2006-07.
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 2002-03 to 2006-07 Australia recorded small annual surpluses on its international trade in services. In 2006-07 exports of $46.2b were largely matched by imports $44.5b to give a surplus of $1.8b. The major contributors to services exports in 2006-07 were personal travel services, of which around half were education-related, passenger transportation services and miscellaneous business, professional and technical services. The major contributors to services imports were personal travel services, freight services, passenger transportation services, royalties and licence fees and miscellaneous business, professional and technical services.
31.11 INTERNATIONAL TRADE IN SERVICES, By service type

2002-03
2003-04
2004-05
2005-06
2006-07
$m
$m
$m
$m
$m

EXPORTS

Transportation services
7 386
7 530
8 002
8 208
8 763
Passenger(a)
6 538
6 772
7 298
7 600
8 146
Freight
848
758
704
608
617
Other(a)
np
np
np
np
np
Travel services
18 312
20 099
21 440
22 624
25 220
Business
1 584
1 850
1 725
2 085
2 464
Personal
16 728
18 249
19 715
20 539
22 756
Communications services(b)
1 037
876
831
834
815
Construction services
105
104
106
134
144
Insurance services
673
686
684
704
704
Financial services
984
1 015
998
1 002
1 004
Computer and information services
1 160
1 218
1 251
1 198
1 475
Royalties and licence fees
661
669
706
772
894
Other business services
4 115
4 057
4 263
4 840
5 763
Merchanting and other trade-related
514
637
653
729
785
Operational leasing
27
23
19
35
40
Miscellaneous business, professional and technical
3 574
3 397
3 591
4 076
4 938
Personal, cultural and recreational
752
657
547
659
603
Government services n.e.i.
802
835
867
874
848
Total
35 987
37 746
39 695
41 849
46 233

IMPORTS

Transportation services
-10 960
-11 970
-13 796
-14 508
-15 555
Passenger
-4 248
-5 126
-5 420
-5 939
-6 714
Freight
-5 808
-6 056
-7 500
-7 776
-8 044
Other
-904
-788
-876
-793
-797
Travel services
-10 978
-12 527
-14 507
-15 090
-15 947
Business
-2 283
-2 422
-2 472
-2 512
-2 630
Personal
-8 695
-10 105
-12 035
-12 578
-13 317
Communication services(b)
-1 495
-1 067
-842
-829
-860
Construction services
-
-
-
-
-
Insurance services
-856
-874
-872
-900
-900
Financial services
-581
-540
-527
-581
-600
Computer and information services
-1 031
-1 053
-1 095
-1 067
-1 472
Royalties and licence fees
-2 151
-2 361
-2 482
-2 734
-3 249
Other business services
-3 793
-3 564
-3 314
-3 488
-3 978
Merchanting and other trade-related
-344
-178
-200
-188
-207
Operational leasing
-955
-916
-698
-769
-841
Miscellaneous business, professional and technical
-2 494
-2 470
-2 416
-2 531
-2 930
Personal, cultural and recreational services
-934
-984
-1 120
-1 080
-1 067
Government services n.e.i.
-684
-756
-760
-801
-848
Total
-33 463
-35 696
-39 315
-41 078
-44 476

- nil or rounded to zero (including null cells)
np not available for publication but included in totals where applicable, unless otherwise indicated
(a) Passenger transportation exports includes other transportation services.
(b) Communication services includes other services n.e.i..
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 2005-06.
31.12 SERVICES EXPORTS, Major countries of destination - 2005-06

Value
Share of total exports
Average annual change(a)
$m
%
%

United States of America
5 286
12.6
-3.1
United Kingdom
4 356
10.4
2.2
Japan
3 184
7.6
-3.8
China
3 169
7.6
25.2
New Zealand
3 006
7.2
5.9
Singapore
2 684
6.4
4.1
Hong Kong (SAR of China)
1 574
3.8
3.5
Korea
1 451
3.5
9.0
India
1 401
3.3
21.8
Malaysia
1 201
2.9
5.9

(a) In the 5-year period 2000-01 to 2005-06.
Source: International Trade in Services by Country, by State and by Detailed Services Category, Financial Year (5368.0.55.003).

31.13 SERVICES IMPORTS, Major countries
of origin - 2005-06

Value
Share of total imports
Average annual change(a)
$m
%
%

United States of America
7 071
17.2
0.9
United Kingdom
4 004
9.7
0.3
Singapore
3 942
9.6
12.1
Japan
2 140
5.2
-0.3
New Zealand
2 111
5.1
2.5
Hong Kong (SAR of China)
1 618
3.9
1.4
Germany
1 282
3.1
2.1
China
1 122
2.7
8.5
Thailand
1 055
2.6
8.6
Switzerland
834
2.0
-2.9

(a) In the 5-year period 2000-01 to 2005-06.
Source: International Trade in Services, by Country, by State and by Detailed Services Category, Financial Year (5368.0.55.003).


In 2005-06 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 and Japan.

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 1997 and 30 June 2007 is mostly due to a rise in Australia's net foreign debt. At 30 June 2007 Australia's net foreign liabilities of $642.4b were comprised of net foreign debt of $544.1b and net foreign equity of $98.4b.

31.14 Net international investment position - 30 June
Graph: 31.14 Net international investment position—30 June

Table 31.15 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.
31.15 INTERNATIONAL INVESTMENT POSITION

Position at beginning of period
Changes in position reflecting - transactions
Changes in position reflecting - price changes
Changes in position reflecting - exchange rate changes
Changes in position reflecting - other adjustments
Position at end of period
$m
$m
$m
$m
$m
$m

NET INTERNATIONAL INVESTMENT POSITION

Total
2004-05
453 326
55 141
-10 170
7 614
-233
505 678
2005-06
505 678
53 286
-16 414
11 357
-1 336
552 571
2006-07
552 571
57 185
17 603
14 377
704
642 438
Equity
2004-05
63 840
-7 689
-4 687
23 940
-17
75 386
2005-06
75 386
-20 245
356
-4 541
836
51 792
2006-07
51 792
-486
18 161
29 412
-515
98 364
Debt
2004-05
389 487
62 830
-5 483
-16 327
-216
430 291
2005-06
430 291
73 531
-16 769
15 898
-2 172
500 779
2006-07
500 779
57 671
-558
-15 035
1 219
544 075

FOREIGN ASSETS(a)

Total
2004-05
-638 398
42 999
-56 683
16 849
-44
-635 276
2005-06
-635 276
-89 764
-66 769
-7 920
265
-799 464
2006-07
-799 464
-126 260
-61 933
25 585
756
-961 316
Equity
2004-05
-370 749
44 958
-48 546
23 940
695
-349 700
2005-06
-349 700
-53 719
-47 178
-4 541
84
-455 053
2006-07
-455 053
-57 030
-50 681
29 412
-54
-533 406
Debt
2004-05
-267 649
-1 959
-8 138
-7 091
-739
-285 576
2005-06
-285 576
-36 044
-19 592
-3 380
180
-344 412
2006-07
-344 412
-69 229
-11 251
-3 826
810
-427 910

FOREIGN LIABILITIES(b)

Total
2004-05
1 091 724
12 142
46 513
-9 235
-189
1 140 954
2005-06
1 140 954
143 049
50 355
19 278
-1 601
1 352 035
2006-07
1 352 035
183 445
79 536
-11 208
-52
1 603 755
Equity
2004-05
434 589
-52 647
43 858
-
-713
425 086
2005-06
425 086
33 474
47 534
-
753
506 845
2006-07
506 845
56 544
68 842
-
-461
631 770
Debt
2004-05
657 135
64 790
2 654
-9 235
522
715 867
2005-06
715 867
109 577
2 822
19 278
-2 353
845 190
2006-07
845 190
126 900
10 693
-11 208
409
971 984

- nil or rounded to zero (including null cells)
(a) Assets include claims of Australian direct investment enterprises on direct investors abroad, which are classified as part of direct investment in Australia.
(b) 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 31.16 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 2007 the public sector was in a small net debt asset position with non-residents. Of total private sector net foreign debt of $559.1b at 30 June 2007, private financial corporations accounted for $456.0b and private non-financial corporations accounted for $103.1b.

31.16 LEVELS OF FOREIGN DEBT - 30 June

2003
2004
2005
2006
2007
$m
$m
$m
$m
$m

Foreign debt assets(a)
-225 657
-267 649
-285 576
-344 412
-427 910
Public sector
-55 337
-66 395
-73 023
-82 725
-96 975
Private sector
-170 320
-201 254
-212 553
-261 687
-330 935
Foreign debt liabilities(a)
582 651
657 135
715 867
845 190
971 984
Public sector
63 576
71 470
83 606
88 210
81 912
Private sector
519 075
585 665
632 261
756 980
890 073
Net foreign debt
356 995
389 487
430 291
500 779
544 075
Public sector
8 240
5 075
10 583
5 485
-15 063
Private sector
348 755
384 411
419 708
495 293
559 138

(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).

Levels of foreign investment in Australia and Australian investment abroad

In table 31.17, 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).

31.17 LEVELS OF AUSTRALIAN INVESTMENT ABROAD AND FOREIGN INVESTMENT IN AUSTRALIA - 30 June

2003
2004
2005
2006
2007
$m
$m
$m
$m
$m

Levels of Australian investment abroad
-502 663
-608 327
-606 159
-768 206
-923 276
Direct investment abroad(a)
-189 590
-232 047
-201 395
-274 304
-318 752
Portfolio investment assets
-160 685
-199 132
-223 021
-280 653
-343 468
Financial derivative assets
-40 735
-42 058
-38 790
-46 300
-56 717
Other investment assets
-70 894
-84 748
-86 784
-103 134
-124 657
Reserve assets
-40 760
-50 342
-56 170
-63 815
-79 682
Levels of foreign investment in Australia
918 568
1 061 653
1 111 837
1 320 776
1 565 715
Direct investment in Australia(b)
252 561
274 082
271 698
289 934
331 398
Portfolio investment liabilities
481 212
609 272
651 876
820 912
982 275
Financial derivative liabilities
45 251
37 683
42 009
40 999
67 638
Other investment liabilities
139 544
140 616
146 254
168 931
184 404

(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).


The level of Australian investment abroad rose $155.1b over 2006-07, while the level of foreign investment in Australia rose $244.9b over the same period. The difference largely mirrors the increase in net foreign liabilities (table 31.15). However, the items 'Australian investment abroad' and 'Foreign investment in Australia', in table 31.17, do not equate exactly with foreign assets and liabilities respectively, in table 31.15. The difference is due to netting of assets and liabilities in regard to direct investment, both abroad and in Australia. In table 31.17, 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 31.15.

Foreign ownership of equity in Australia

Table 31.18 shows the proportion of equity in Australian enterprise groups held by non-residents.

The total value of equity on issue by Australian enterprise groups at 30 June 2007 was $2,195b, of which non-residents held 29% and residents held 71%. As a percentage, foreign ownership of Australian equity has remained reasonably steady over the four-year period to 30 June 2007.

The major issuers of equity capital are non-financial corporations and banks, accounting for 65% and 14% respectively of the total equity issued by Australian enterprise groups in at 30 June 2007. Non-residents held 32% of the equity issued by non-financial corporations and 24% of the equity issued by banks.

31.18 FOREIGN OWNERSHIP OF EQUITY(a), By sectoral components - 30 June

2003
2004
2005
2006
2007

Non-financial corporations(b)
Amount issued(c) $b
774.0
881.1
938.9
1 134.8
1 420.6
Amount held by rest of world $b
275.0
332.7
305.8
369.2
458.5
Proportion of foreign ownership %
35.5
37.8
32.6
32.5
32.3
Banks
Amount issued(c) $b
180.9
189.2
223.5
261.4
316.0
Amount held by rest of world $b
46.8
48.6
55.2
62.3
75.6
Proportion of foreign ownership %
25.9
25.7
24.7
23.8
23.9
Non-bank deposit taking institutions
Amount issued(c) $b
34.2
30.8
33.2
35.7
38.7
Amount held by rest of world $b
7.4
12.5
13.6
14.0
15.4
Proportion of foreign ownership %
21.7
40.4
41.1
39.3
39.8
Other financial enterprises(d)
Amount issued(c) $b
200.5
221.1
255.1
310.2
410.4
Amount held by rest of world $b
33.8
40.9
50.4
61.4
82.3
Proportion of foreign ownership %
16.9
18.5
19.8
19.8
20.0
Central Bank
Amount issued(e)(f) $b
11.7
12.5
11.2
12.7
9.7
Total amount issued $b
1 201.3
1 334.8
1 461.9
1 754.8
2 195.4
Total amount held by rest of world $b
363.0
434.6
425.1
506.8
631.8
Proportion of foreign ownership %
30.2
32.6
29.1
28.9
28.8

(a) Equity includes units in trusts.
(b) Includes private non-financial corporations, and Commonwealth, state and local public non-financial corporations.
(c) These estimated market values are considered to be of poor quality. They should be used cautiously.
(d) Includes life offices and superannuation funds, central borrowing authorities, and other financial enterprises.
(e) Net asset values.
(f) There is no foreign ownership in this component.
Source: Australian National Accounts: Financial Accounts (5232.0); Balance of Payments and International Investment Position, Australia (5302.0).


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