The
balance of a payment is a systematic record of all its monetary transactions
with other countries of the world in a given period of time. i.e 1 year. BOP
calculated in every quarter in a calendar year.
Features
of BOP
It is a systematic record of all
economic transactions between one country and the rest of the world.
It includes all transactions, visible
as well as invisible.
It relates to a period of time. Generally,
it is an annual statement.
It adopts a double-entry book-keeping
system. It has two sides: credit side and debit side. Receipts are recorded on
the credit side and payments on the debit side.
Components
of BOP
|
Credit/+/Receipts
|
Debit/-/Payments
|
|
(1)Current
Account
|
|
|
Exports
Goods, Services, Transfer payments
|
Imports
Goods, Services, Transfer payments
|
|
(2)Capital
Account
|
|
|
Direct investment and borrowing
from foreign countries.
|
Direct investment and borrowing to
foreign countries.
|
|
(3)Official
settlement account
|
|
|
Increase in foreign official
holdings
|
Increase in official reserves of
gold and currencies
|
|
(4)
Errors & Omissions
|
|
|
-
|
-
|
