5.
"While the availability of data on external factor income flows and GNP estimates represents a big step towards providing a better coverage of key economic and financial data, there has been an increasing demand for complete BoP statistics for Hong Kong," Mr Ho continued.
A BoP account can be broadly described as a systematic statistical record of an economy's external transactions during a specific period, typically a year or quarter.
A complete BoP account comprises (a) current account, that is all the goods and services, incomes and current transfers an economy receives from or provides to the rest of the world; and (b) capital and financial account, that is capital transfers and changes in an economy's financial claims and liabilities.
"The existing statistical system already provides most of the data required for compiling the current account of the BoP account, with the exception of data on current transfers. With some further extension, a complete current account can be established," said Mr Ho,
"Current transfers refer to transactions in which an economy makes payments or gives donations or gifts, whether in cash or in kind, to another economy without receiving any value in return.
"Examples are workers' remittances sent or received by residents to or from non-residents, and donations or gifts given or received by the government or residents to or from other governments or non-residents.
"The capital and financial account includes transfer of capital assets; transactions in an economy's non-produced, non-financial assets such as patents and copyrights; and transactions in an economy's external financial assets and liabilities.
"Thus data on the outflow and inflow of various kinds of investments (that is direct investment, portfolio investment and other investment) are needed.
"In this regard, relatively little data are available at present, apart from inward external direct investment and changes in foreign exchange reserves of the Exchange Fund.
"The investigatory study will aim at ascertaining the appropriate methods for collecting the necessary data, and the associated costs to the government, for the compilation of a complete BoP account for Hong Kong.
"BoP statistics are important for monetary and financial monitoring and policy deliberations in both territorial and international contexts.
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