Balance of payments surplus jumps to $54.6b in Q2

The rise was mainly driven by larger net inflows of primary income and a higher services surplus.

The balance of payments surplus rose to $54.6b in the second quarter (Q2), or 6.5% of GDP, up sharply from $35.2b in Q1, according to the Census and Statistics Department.

The report showed that reserve assets also increased by the same amount, up from $35.2b in Q1.

Current account surplus rose to $96b, or 11.4% of GDP, from $93.1b year-on-year (YoY), mainly driven by larger net inflows of primary income and a higher services surplus, partly offset by a wider goods deficit.

The primary income inflow and outflow amounted to $664.6b and $540.9b respectively, yielding a net inflow of $123.7b in Q2, up from $107b YoY.

The goods deficit widened to $59.1b from $38.3b YoY, whilst the services surplus increased to $38.5b from $30.9b, the data showed.

Meanwhile, financial non-reserve assets increased to $76.8b in Q2, reversing a $36.7b decline in the previous quarter.

The department attributed this growth to a net rise in portfolio investment, partly offset by declines in other investment, financial derivatives and direct investment.

At the end of Q2, external financial assets stood at $62.86t, 18.3 times of GDP, whilst external liabilities totalled $43.45t, 12.7 times of GDP.

Net external financial assets rose to $19.41t, 5.7 times of GDP, from $18.45t, 5.5 times of GDP, at the end of Q1.

Gross external debt increased to $17.87t at the end of Q2 from $16.63t three months earlier. 

The banking sector accounted for 52.7% of the debt, followed by other sectors at 31.1% and debt liabilities in direct investment, mainly intercompany lending, at 14.6%.