Exercise on BOP

I. Please look at the following BOP and answer the questions given below: 6

Figures in M US$
Item
Year – 1 Year – 2

Trade balance -2215 -2319

Import 8707 9840
Service (Net) -691 -874
Income (Net) -358 -374
CAB 176 176
Capital Account 428 196
Financial Account 413 78
Errors and Omission -202 -179
Reserve Assets -815 -271

a) What were the values of exports in year – 1 and Year – 2?

b) Find out the values of Unilateral Transfer in Year – 1 and Year – 2?
c) What is the best indicator of the overall performance of BOP of a country? Can you
find out the “value” of that indicator in Year – 1 and Year – 2?

II. Look at the following BOP table of Bangladesh and answer the questions that follow:
BOP of Bangladesh
(Million US $)
Item FY04 FY05 FY06 FY07
Capital Transfer 196 163 375 490
Financial Account (31) 784 (141) 721
Current A/C Balance 176 (557) 824 952
Current Transfer 3743 4290 5438 6554
Trade Balance (2319) (3297) (2889) (3458)
Service Balance (874) (870) (1023) (1261)
Income Balance (374) (680) (702) (883)
Errors and Omissions (170) (323) (720) (670)
Reserve Assets (171) (67) (338) (1493)

a) Which international transactions are included in capital transfer?

b) Name the international transactions which are included in service A/c.
c) Errors and Omissions figures are negative in all the four years. What is the reason?
d) What are the OB in these years?
e) What are the constituents of financial account?
f) What are the constituents of current transfer?