, A Special Lecture by Bank of Korea on Economic Statistics Indicators on the Overall Balance of Payments

A special lecture by Bank of Korea on economic statistics indicators on the overall balance of bayments, , hosted by the KUBS Career Development Center, was held online on May 20^th in the morning.

The lecturer was Chang-hyun Park, head of the balance of payments team of the Bank of Korea's Economic Statistics Bureau, gave a lecture on the overall balance of payments. The lecture was conducted in the order of △ meaning of balance of payments, △ writing principle of balance of payments statistics △ composition of actual balance of payments.

Team leader Chang-hyun Park began the lecture by introducing media reports on Korea's balance of payments. He then explained the definition of the international balance as a "table that systematically classifies and organizes all economic transactions between residents and non-residents for a certain period of time," and said, "It can also refer to a specific table as an international balance sheet." The meaning of balance of payments was explained in detail by dividing it into the △ period △ residents and non-residents △ economic transactions △ systematic classification·arrangement. Lecture on the ‘International Balance of Payments Manual’, an international standard for the comprehensive scope, classification, and evaluation of international balance of payments statistics published by the IMF, followed.

He explained the principle of international balance of payments by dividing it into △ double-entry bookkeeping principle, △ transaction evaluation, △ accrualism principle, △ calculation unit and conversion, and △ considering transaction variation. The "double-entry bookkeeping principle" means that all external transactions between residents and non-residents are recorded at the same amount in debit and credit, respectively, and the "accrualism principle" means that economic value must be accounted for when it is created, changed, exchanged, transferred, or extinguished. Therefore, the international balance of payments should be evaluated at the actual market price, following the double-entry bookkeeping principle and the accrual principle, while Korea should reflect changes in transactions based on US dollars. Team leader Park Chang-hyun added, "The current account and capital account should be recorded in total and the financial account should be recorded in net amount."

The following was a lecture on the composition of the balance sheet. Prior to the full-fledged explanation, team leader Park Chang-hyun said, "The components of the balance of payments are ‘current account balance’ and ‘capital balance’ which consists of △ product balance △ service balance △ main income balance △ previous income balance and ‘financial accounts’ and ‘erros and omissions’ which consists of △ direct investment △investments to securities △ derivative financial instruments △ other investment △ reserve assets. "Since the mid-2000s, overseas production has expanded and international balance statistics reflecting overseas production such as processing trade and intermediary trade have been published in accordance with new international standards," he added. A detailed description of each element followed. Team leader Park Chang-hyun explained the difficult concept in an interesting way through a press release or various related articles.  

The lecture was concluded by summarizing the main points of the lecture which was △ the meaning of the international balance of payments, the principle of writing statistics of balance of payments △ the core contents of the actual balance of payments sheet. Uncertainty and improvement measures were also mentioned for terms such as 'error and omission' in Korea balance of payments table. Team leader Park Chang-hyun finished the lecture, saying, "If you have any questions about the lecture or the international balance of payments, feel free to contact me."