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The international investment position of the United States in 1987.

The International Investment Position of the United States in 1987 By RUSSELL B. SCHOLL

THE negative net international investment position of the United States increased $99.0 billion to $368.2 billion in 1987 from $269.2 billion (revised) in 1986 (table 1). Net capital inflows of $135.5 billion were accounted for by substantial net inflows to U.S. banks from banks overseas, large net foreign purchases of U.S. corporate securities, and increased foreign official inflows largely reflecting intervention purchases of dollars by several industrial countries. The capital inflows were partly offset by net valuation adjustments of $36.5 billion, mostly reflecting exchange rate appreciation of U.S. holdings of foreign securities, and price depreciation of U.S. securities, held by foreigners. By yearend 1987, foreign assets in the United States increased to $1,536.0 billion from $1,340.7 billion (revised), and U.S. assets abroad increased to $1,167.8 billion from $1,071.4 billion (revised) (table 2).

The increase in the negative net investment position in 1987 reflected the continued large U.S. current-account deficit, which widened to $154.0 billion in 1987 from $138.8 billion in 1986. Net capital inflows, the mirror image of the current-account deficit, were attracted by a significant widening of the interest rate differentials between (higher) U.S. and (lower) foreign rates and by U.S. economic expansion. Inflows of private capital were augmented by large inflows of official capital, as foreign monetary authorities, through coordinated intervention in exchange markets, purchased substantial amounts of dollars. Banks in the United States stepped up their borrowing from the interbank market overseas and limited their lending to that market, as the cost of funding in the United States rose. Until the October stock market plunge, foreign investment in U.S. stocks was particularly strong; foreign purchases of bonds newly issued overseas by U.S. corporations slowed. Net outflows in the direct investment accounts were small, as record U.S. direct investment abroad was mostly offset by continued strength in foreign direct investment in the United States.

The statistical discrepancy in the U.S. international transactions accounts was again a large net inflow in 1987. If part of these net unrecorded inflows were capital inflows, net foreign assets in the United States would be understated by that amount. On the other hand, understatement of some U.S. assets abroad -- for instance, because direct investment is carried at book value--would work in the opposite direction. Thus, the net investment position is only a rough indictator, rather than a precise statistical measure, and should be interpreted with caution.

Changes in U.S. Assets Abroad

Bank claims

Claims on foreigners reported by U.S. banks increased $40.5 billion, or 8 percent, to $547.9 billion (line 19). Growth in U.S. claims denominated in dollars in the overseas interbank market was further curtailed in 1987, especially by U.S.-owned banks.

Increased lending in foreign currencies offset some of the slowdown. The slowing partly reflected the rise in U.S. interest rates, as the U.S. prime rate jumped from 7.5 to 9.25 percent between April and September, and the increase in demand for currencies other than the dollar, especially the Japanese yen. Outside the interbank market, U.S. bank lending was practically stagnant; virtually no new loans went to major debtor countries in Latin America.

U.S. banks' own dollar claims increased $140.0 billion to $458.7 billion -- only one-third the 1986 increase. Claims on own foreign offices and unaffiliated banks abroad increased $15.9 billion to $350.4 billion. The rise in claims in the overseas interbank market occurred in April and in the autumn of the year. In both periods, foreign demand for dollar credits surged in response to temporary increases in Eurodollar interest rates compared with U.S. rates and to strong demand for U.S. bank credits in Asia, especially by Japan. Most of the rise in U.S. claims was accounted for by foreign-owned banks in the United States, especially Japanese-owned banks, which participated only briefly in these lending surges, subsequently reduced their claims on banks abroad, resulting in the third consecutive annual decline in their interbank claims.

Unaffiliated banks in Japan received the largest share of U.S. lending--over one-half. Japanese banks continued to expand their share of international banking business and to accommodate strong demand for bank credit from nonbank Japanese residents. Claims on banks in France, Canada, and other parts of Asia also increased; in contrast, banks in the United Kingdom made sizable repayments. U.S. banks in the United States.

U.S. banks' dollar claims on other private and foreign public borrowers decreased $2.0 billion to $108.3 billion; an increase in claims on borrowers in Japan and Canada was more than offset by a decrease in Western Europe and Latin America. Claims on major debtor countries in Latin America were reduced through loan sales, equity swaps, and regular repayments; little new lending took place. The claims reduction occurred during a year when Brazil and Ecuador discontinued servicing a major portion of their indebtedness with international banks and U.S. banks set aside substantial amounts from current earnings as reserves for possible loan losses.

U.S. banks' and customers' claims payable in foreign currencies increased sharply, $22.7 billion, to $51.3 billion. Three-fourths of the increase was with banks in Japan, which expanded their international banking activities by advancing yen credits to foreigners and to nonbank residents in Japan.

U.S. bank claims for domestic customers' accounts, payable in dollars, increased $3.8 billion to $37.7 billion in 1987; deposits in banks overseas slowed due to rising U.S. interest rates.

Foreign securities

Holdings of foreign securities in U.S. portfolios increased $13.5 billion to $146.7 billion; net purchases of $4.5 billion and exchange rate appreciation of $14.7 billion were partly offset by $5.6 billion in pricce depreciation (line 15). Stock prices fell sharply in major financial markets in the last quarter of 1987, after having increased strongly earlier in the year.

U.S. holdings of foreign bonds increased $9.2 billion to $91.0 billion (line 16). U.S. purchases accelerated in the fourth quarter when bond prices rebounded, resulting in $6.8 billion in net purchases for the year. Valuation adjustments reflected appreciation of $7.0 billion in foreign currency bonds and a partly offsetting $4.5 billion in price depreciation in dollar bonds. U.S. net purchases of new issues of foreign bonds in the U.S. market were $6.2 billion, bolstered by the fourth quarter's rebound in prices. Issues were limited to highly rated government borrowers until the fourth quarter. Canada and international financial institutions were the principal issuers; redemptions of their outstanding issues largely offset U.S. purchases. Purchases of Australian and New Zealand new issues increased in popularity due to their high yields. U.S. net purchases of outstanding bonds -- mostly high-yielding British gilt-edged bonds -- were enhanced by appreciation of the British pound.

U.S. holdings of foreign stocks increased $4.3 billion to $55.7 billion. The increase was more than accounted for by exchange rate appreciation of $7.7 billion, partly offset by $2.4 billion in net U.S. sales and prices depreciation of $1.1 billion (line 17). Most of the net sales and price depreciation occurred following the world-wide stock price plunge in the last quarter of the year, although some switching from Japanese to Canadian and Western European stocks had been underway earlier. Profit-taking net sales of Japanese stocks began in mid-1986 and accelerated in 1987, nearly depleting U.S. holdings despite buoyant Japanese stock prices and the rising exchange value of the yen. U.S. net purchases of British and Canadian stocks halted in the fourth quarter, except for U.S. underwriters' purchases of British Petroleum stock from the British Government that were contracted before the market plunge.

U.S. direct investment abroad and other private assets

U.S. direct investment abroad increased $49.3 billion, a record 19 percent, to $308.9 billion (line 14). Reinvested earnings nearly doubled to $35.7 billion; equity and intercompany debt capital outflows totaled $8.8 billion, and valuation adjustments added $4.9 billion. Earnings of foreign affiliates of U.S. companies improved substantially, augmented by large currency transaltion gains as the dollar declined sharply against major foreign currencies. The strong increase in reinvested earnings also reflected changes in the Tax Reform Act of 1986 restricting the use of foreign tax credits. Investment in Canada, Japan, United Kingdom, and some other European countries increased; net funding of finance affiliates in the Netherlands Antilles slowed. (Details on 1987 direct investment developments are in a separate section on "U.S. Direct Investment Abroad" in this article.)

Claims on unaffiliated foreigners reported by U.S. nonbanking concerns decreased $3.1 billion to $30.1 billion; financial claims decreased $4.1 billion, and commercial claims increased $1.0 billion (line 18). U.S. corporations, faced with rising interest rates in the United States, drew down their deposits in Canada, the United Kingdom, and Caribbean banking centers and expanded their trade credits to industrial countries.

U.S. official reserve assets and other U.S. Government assets

U.S. official reserve assets decreased $2.7 billion to $45.8 billion; reductions in assets of $9.1 billion were partly offset by exchange rate appreciation of $6.4 billion (line 3). Most of the reduction in assets was due to the sale of German marks and Japanese yen in exchange markets as part of coordianted intervention with other industrial countries. Exchange rate appreciation offset about one-half the decline in foreign currency holdings. Valuation adjustments to other reserve assets mostly reflected a rise in the value of the market basket of currencies used to value special drawing rights and the U.S. reserve position in the International Monetary Fund.

U.S. Government assets, other than official reserve assets, decreased $1.2 billion to $88.4 billion -- the first drop since 1974 (line 8). Repayments on Export-Import Bank (EIB) credits were accelerated by creditors in the United Kingdom, Japan, and other countries in Asia, and prepayments were made by Korea, Spain, Thailand, and Oman on credits financing military exports that had been contracted at the high interest rates prevailing earlier in the 1980's. Concurrently, disbursements of U.S. Government credits, particularly EIB credits, slowed.

Changes in Foreign Assets in the United States

Bank liabilities

Liabilities to private foreigners and international financial institutions reported by U.S. banks increased a record $87.8 billion, or 19 percent, to $539.4 billion (line 35). U.S. banks borrowed heavily from the overseas interbank market, partly to finance domestic expansion and increased lending in foreign currencies. Inflows were encouraged by a substantial widening of the differential between (higher) U.S. and (lower) foreign interest rates and by a growing preference for liquid dollar assets and foreign currency credits by international investors. High yields on bank deposits relative to yields on Treasury bills also favored bank inflows. Dollar liabilities to own foreign offices and unaffiliated foreign banks increased $61.1 billion to $371.1 billion. Foreign-owned banks in the United States -- especially Japanese-owned banks -- that were rapidly expanding their lending in the United States and overseas accounted for more than 60 percent of the increase; most of the borrowing occurred in the fourth quarter, when demand for bank credit surged. U.S.-owned banks borrowed most heavily from their own foreign offices in April and September, when bank reserves tightened and the U.S.-Eurodollar interest rate differential widened, favoring funding from offshore.

Banks in Western Europe provided over 60 percent of the increase in interbank liabilities. Banks in Canada and in Asian banking centers, excluding Japan, accounted for another 20 percent. Banks in Japan, faced with heavy credit demands, withdrew funds from the United States and also received a substantial share of new lending by banks in the United States.

U.S. banks' liabilities payably in foreign currencies increased $25.3 billion to $54.9 billion, mostly to finance expanded foreign currency lending. More than one-half of the increase was to Japan; the remainder was mainly to Western Europe.

Banks' custody liabilities increased $2.6 billion to $44.3 billion; most of the increase occurred in the second and third quarters, when U.S. interest rates increased sharply.

U.S. Treasury securities

U.S. Treasury securities held by private foreigners and international financial institutions decreased $13.1 billion to $78.4 billion, as a result of $7.6 billion in net sales and $5.5 billion in price depreciation (line 30). Foreigners sold $1.8 billion of bills and $5.8 billion of bonds following 3 years of net purchases. Japanese sales were especially large, as institutional investors there shifted portfolios from bonds to U.S. stocks and profited from the fourth-quarter recovery in bond prices. International financial institutions, switching to U.S. bank deposits, also liquidated some of their holdings. Sales through accounts in the Caribbean were also large. Although net purchases for accounts in the United Kingdom continued, they were 25 percent below last year's pace.

Other U.S. securities

Foreign holding of U.S. securities, other than U.S. Treasury securities, increased $35.6 billion, or 8 percent, to $344.4 billion, reflecting strong foreign demand for most of the year (line 31). Net foreign purchases of $42.2 billion were offset by $12.4 billion in price depreciation, mostly due to the steep fall in U.S. stock prices in October. Exchange rate appreciation of foreign currency bonds issued by U.S. companies and held overseas added $5.8 billion to holdings.

Foreign holdings of U.S. corporate and other bonds increased $28.9 billion, or 20 percent, to $171.0 billion, bolstered by the above-mentioned $5.8 billion in exchange rate appreciation. Partly offsetting was price depreciation of $3.6 billion (line 32). Rising bond rates and a weak dollar in exchange markets reduced both the demand for and the supply of U.S. corporate bonds newly issued overseas, which fell 40 percent to $22.6 billion. U.S. industrial companies and nonbank financial firms reduced their placements, and bank holding companies withdrew from the floating-rate note market. Straight fixed-rate bonds were preferred by international investors and accounted for most of the U.S. issues; bonds convertible into U.S. stock were increasingly issued until the plunge in U.S. stock prices. Foreign currency issues by U.S. corporations declined to less than one-half the prior year's level.

Because most U.S. issues overseas are initially placed through underwriters in the United Kingdom, holdings in Western Europe showed the largest increase. Direct purchases by Japanese institutions slowed substantially after 2 years of strong increases.

Foreign holdings of U.S. federally sponsored agency bonds inccreased $3.4 billion to $20.5 billion, entirely reflecting net purchases by Western European and Japanese residents.

Foreign holdings of U.S. stocks increased strongly until October; net purchases for the first three quarters of 1987 exceeded purchases for 1985 and 1986 combined. Large net sales occurred in the fourth quarter, as stock prices plummeted 30 percent in October. For the year, foreign holdings increased $6.7 billion to $173.4 billion; net purchases of $15.5 billion were partly offset by $8.8 billion in price depreciation (line 33). Japan accounted for over 70 percent of the net purchases, partly due to the relaxation of restrictions on Japanese institutional investors' foreign portfolios and to the strong yen. Japanese purchases slowed considerably in the fourth quarter. Western European residents made large net purchases before the market plunge, but sold over 85 percent of these purchases in the fourth quarter.

Foreign official assets

Foreign official assets held in the United States increased $41.4 billion to $283.1 billion, mostly reflecting intervention purchases of dollars in exchange markets -- subsequently invested in U.S. Treasury securities -- by major industrial countries (line 21). Capital inflows of $45.0 billion were partly offset by $3.6 billion in price depreciation. Industrial countries' dollar assets increased $49.2 billion, more than accounting for the increase in total official holdings. (In addition, some of their dollars acquired as a result of intervention were placed in the Eurodollar market.) OPEC members again reduced their dollar assets, by $10.0 billion, as petroleum revenues remained weak. Assets of other countries, mostly those of newly industrialized countries in Asia with large trade surpluses, increased $5.7 billion.

Foreign direct investment in the United States and other liabilities

Foreign direct investment in the United States increased a record $41.5 billion, or 19 percent, to $261.9 billion (line 29). Substantial acquisition activity continued as equity inflows remained strong as $25.5 billion; intercompany debt inflows increased to $14.0 billion, and reinvested earnings shifted to a positive $2.5 billion. The largest inflow was from the United Kingdom, followed by Japan and the Netherlands. Sustained U.S. economic expansion, the depreciation of the dollar against major currencies, U.S. corporate restructuring through the sale of assets, and rising protectionist sentiment in the United States were among the factors contributing to the growth of foreign investment in the United States. (Details on 1987 direct investment developments are in a separate section on "Foreign Direct Investment in the United States" in this article.)

U.S. liabilities to unaffiliated foreigners reported by U.S. nonbanking concerns increased $2.2 billion to $28.8 billion, partly associated with capital goods purchases in the United States and partly representing increased payables for petroleum imports. Financial liabilities decreased $0.8 billion, as U.S. firms continued to repay loans from foreign branches of U.S. banks in the Caribbean.

Direct Investment

U.S. direct investment abroad

The U.S. direct investment position abroad increased 19 percent ($49.2 billion) in 1987, to $308.8 billion, compared with 13 percent in 1986 (table 3).(1) The 1987 increase marked the fourth consecutive year of increased growth and was a record, both in percentage and dollar terms.

(1). The position is the book value of U.S. direct investors' equity in, and net outstanding loans to, their foreign affiliates. A foreign affiliate is a foreign business enterprise in which a single U.S. investor owns at least 10 percent of the voting securities, or the equivalent.

Hearly three-fourths of the increase resulted from the reinvestment of earnings. Reinvested earnings were $35.7 billion, nearly double the previous record level of $19.7 billion in 1986. Their rapid growth in 1987 was due to increases in both earnings and the reinvestment ratio.

Earnings rose $13.0 billion, to $54.7 billion, mainly because of the twofold effects of dollar depreciation. First, the translation into dollars, at the new exchange rates, of affiliates' assets and liabilities denominated in foreign currencies resulted in large capital gains, which are included in earnings. Second, the translation into dollars of affiliates' earnings denominated in foreign currencies resulted in higher dollar-valued earnings. In addition, improved operating profits in manufacturing -- particularly in transportation equipment, chemicals, and "other manufacturing" -- and in wholesale trade contributed to the increase in earnings. The improvement probably reflected strong demand and more cost-efficient operations resulting from recent corporate restructurings.

The reinvestment ratio, defined as the fraction of earnings that are reinvested, increased substantially, from 0.46 in 1986 to 0.64 in 1987. Three factors contributed to the increase. First, the earlier mentioned capital gains resulting from dollar depreciation are not available for distribution and thus became part of reinvested earnings. Second, U.S. parent companies, particularly in petroleum and manufacturing, have had reasons to reinvest a larger portion of their affiliates' earnings. In petroleum, reinvested earnings are needed to financed increased exploration and development in anticipation that the partial recovery in crude oil prices in 1987 will be maintained. In manufacturing, affiliates are facing increased global competition and are stepping up expansion plans. Finally, the 1986 reinvestment ratio had been lowered by U.S. parent companies in response to provisions of the Tax Reform Act of 1986 that imposed new restrictions on the use of foreign tax credits. To lessen the impact of the new restrictions, which became effective at the beginning of 1987, U.S. parent companies had accelerated the distribution of their affiliates' earnings in the last half of 1986. (U.S. companies use foreign tax codes instead of four-digit codes to facilitate future revisions to the system. Users will be able to derive trade summaries at the one-, two-, three-, and five-digit levels. The four-digit summary level is not used at present because it is the same as the five-digit summary level in nearly all cases. Future changes in the five-digit classifications may require the introduction of the four-digit summary level. Some definitional changes have also been made.

Table F summarizes changes in the lowest level of product detail for each one-digit commodity category for the new and old systems, as measured by the number of categories in each group, and table G indicates changes in the relative importance in various categories that have occured since 1978 as measured by the share of total dollar exports and imports in each group.

The larger number of changes in imports than exports reflects the changing patterns in recent years. The largest areas if import growth have been in capital goods and consumer goods, and that is reflected by the greater degree of detail in these categories under the new schedule. Industrial supplies no longer dominate imports to the extent that they once did, and many detailed categories are no longer shown because they have become relatively insignificant.

Table H presents a comparison of the current and previous series for 1978, the earliest year for which revised data could be produced, and 1987. The differences between current and previous data for 1978 are solely due to changes in definition; the differences for 1987 include, in addition to changes in definition, the effects of the retabulation of Census Bureau data to reflect actual month of transaction , the inclusion of errata to Census data, and the inclusion of the mosts recent United States-Canadian reconciliation revisions.

The definition changes affected imports more than exports. For imports, the changes in petroleum and products largely reflect the addition of benzene and xylene to conform more closely with the definition used by the Department of Energy ($0.5 billion in 1987). These products were previously classified as chemicals and included in industrial supplies. For capital goods, the major changes reflect: (1) television receivers imported as parts ($1.1 billion in 1987), previously classified in electrical machinery, are now a part of consumer goods; and (2) blank audio and visual disks and other media ($1.3 billion in 1987), previously classified in business machines, are now part of industrial supplies as a new category. Within capital goods imports, computers are now a separate category (21300) (references are to the complete end-use outline presented in table J), as are peripherals, accessories, and parts (21301). Both were previously included in business machines. Imports of chemicals are now consolidated under one major 3-digit grouping and are comparable with exports. Another change in imports provided for separate identification of agricultural products. Total agricultural imports can be identified under the new system by adding agricultral foods, feeds, and beverages (00), agricultural industrial supplies and materials (120), and nursery stock and cut flowers (42000).

For exports, nuclear fuels have been redefined to match the definition used in imports by including uranium oxide ($1.1 billion in 1987), previously part of chemicals, and excluding nuclear fuel rods ($.1 billion in 1987), now part of generators, transformers, and parts.

Two new end-use import codes are being introduced in anticipation of the HS. Passenger and cargo vessels (22200) and electric energy (10400), which were not included in the TSUSA, will be separately identified under the new 10-digit codes. In addition, for both exports and imports, spacecraft, engines, and parts, except military (22300) are being added in anticipation of future need for separate identification. No exports were recorded in 1987, and imports were $34 million.

Table I indicates commodity codes, as listed in the complete outline in table J, that are summarized in each commodity category shown in section C of table 3.

Seasonal adjustment. -- Published totals for commodity groupings are the sum of the five-digit categories. All five-digit categories have been tested for seasonality and have been adjusted when they meet statistical criteria for seasonality incorporated in the X-11-ARIMA seasonal adjustment program. Unadjusted data are used for series not meeting the statistical criteria. In all, 19 export series and 24 import series -- accounting for 10 percent and 13 percent of the values of exports and imports, respectively -- are not seasonally adjusted. New seasonal factors were applied to revised unadjusted data for 1978-87.

Previously, seasonal factors were applied to quarterly data. Beginning this year, monthly data are seasonally adjusted and then summed to derived quarterly totals for most series.

It was necessary to continue use of quarterly seasonal factors for 27 exports and 18 import series because they were too erratic for seasonal adjustment on a monthly basis. Generally, the series for which this procedure was used were concentrated in agricultural products, pretroleum products, and passenger cars. The seasonality of agricultural products, especially exports, is affected by weather conditions, which force changes in monthly harvest and shipping patterns. Petroleum and products have been affected by a variety of supply and price movements that have also altered monthly patterns. (Crude petroleum remains too erratic monthly or quarterly seasonal adjustment.) For passenger cars, there has been a change in previous monthly pattern of introducing models during certain months of the year.

Presentation of data. -- The format for table 3 has changed to improve its analytical usefulness. Section C, commodity detail on a balance of payments basis, is expanded, and section D, commodity detail on a Census basis, is eliminated. The old section D differed from section C by the amount of the balance of payments adjustments, many of which could not be distributed by the detailed commodity categories in section D. Exports were primarily affected because limited commodity detail was available for undocumented exports to Canada, which account for a substantial part of the United States-Canadian reconciliation adjustments. More commodity information is now being made available to BEA from the United States-Canadian reconciliation studies than previously. When both countries develop a common set of data in the early 1990's, even greater commodity detail will become available.

TABLE: Table A. -- Summary of U.S. International Transactions

(Millions of dollars, seasonally adjusted)

TABLE: Line Lines in tables 1, 2, and
 TABLE: 10 in which transactions
 TABLE: are included are
 TABLE: indicated in ( )
 TABLE: 1986 TABLE:
 1986 1987
 TABLE: I II III


TABLE: Line Lines in tables 1, 2, and
 TABLE: 10 in which tranactions
 TABLE: are included are
 TABLE: indicated in ( )
 TABLE: 1987 1988 Change
 TABLE: IV I II III IV I(p) 1987:IV-
 TABLE: 1988:I


(p) Preliminary.

TABLE: Table B. -- Selected transaction with Official Agencies

(Millions of dollars)
 TABLE: Line 1986 1987 1988 Change
 TABLE: 1986 1987 1987:IV-
 TABLE: I II III IV I II III IV I(p) 1981:I


(p) Preliminary.

CHART 2: Indexes of Foreign Price of the U.S. Dollar (1977 = 100)

TABLE: Table C. -- Indexes of Foreign Currency Price of the U.S. Dollar

(1977 V 100)
 TABLE: 1987 1988 1987
 TABLE: I II III IV I Mar. Apr. May June July Aug. Sept. Oct.
 TABLE: 1988


TABLE: Nov. Dec. Jan. Feb. Mar.

CHART 2: Current- and Constant-Dollar Changes in Merchandise Exports

CHART 4: Current- and Constant-Dollar Changes in Capital Goods Exports

CHART 6: Current- and Constant-Dollar Changes in Capital Goods Imports

CHART 6: Current- and Constant-Dollar Changes in Merchandise Imports

TABLE: Table D. -- Selected Direct Investment Transaction With Netherlands Antileles Finance Affiliates

(Millions of dollars)
 TABLE: 1986
 TABLE: (Credits +; debits -) 1985 1986 1987
 TABLE: I II III IV I
 TABLE: 1987 1988


TABLE: (Credits +; debits - ) 1985 1986 1987

TABLE: I II III IV I(p)

(p) Preliminary.

TABLE: Table E. -- U.S. Merchandise Trade, Current and Constant (1982) Dollar

(Balance of payments basis, millions of dollars, quarters seasonally adjusted)
 TABLE: Current Dollars
 TABLE: 1987 1988
 TABLE: 1986 1987
 TABLE: I II III IV I(p)
 TABLE: Constant (1982) dollars(1)
 TABLE: 1987 1988
 TABLE: 1986 1987
 TABLE: I II III IV I(p)


(p) Preliminary.

(1) Constant-dollar estimates will be revised in July to incorporate new diflation precedures.

CHART 7: Purchases and Sales of U.S. and Foreign Stocks

CHART 8: Purchases and Sales of U.S. Treasury Securities by Private Foreigners

TABLE F. -- Number of Categories
 TABLE: Exports Imports
 TABLE: Old New Old New


TABLE G. -- Relative Importance of Major Categories (Percent)
 TABLE: Exports Imports
 TABLE: 1978 1987 1978 1987


TABLE H. -- Comparison of Current and Previous Series, 1978 and 1987 (Millions of dollars, balance of payments basis)
 TABLE: 1978 1987
 TABLE: Amount due to:
 TABLE: Cur- Previ- Change Cur- Previ- Total Redefi- Other
 TABLE: rent ous rent ous change nition sources


TABLE I. -- Summary of Export and Import Codes Included in Table 3, section C

TABLE: Exports (line items in table 3) End-use categories included

TABLE J. -- Outline of BEA End-Use Classification System for Exports and Imports, With End-Use Code Numbers
 TABLE: Exports Imports
 TABLE: Abbreviated description End-use Abbreviated description End-use
 TABLE: code code


TABLE 1. -- U.S. International Transactions (Millions of dollars)
 TABLE: Line (Credits +; debits -)(1) 1960 1961 1962 1963 1964 1965
 TABLE: Line (Credits +; debits -)(1) 1966 1967 1968 1969 1970 1971
 TABLE: Line (Credits +; debits -)(1) 1972 1973 1974 1975 1976 1977
 TABLE: Line (Credits + debits -)(1) 1978 1979 1980 1981 1982 1983
 TABLE: Line (Credits +; debits -)(1) 1984 1985 1986 1987 Line


TABLE 1. -- U.S. International Transactions -- Continued
 TABLE: Line (Credits +; debits-)(1) 1982 1983 1984
 TABLE: I II III IV I II III IV I II III IV
 TABLE: Line (Credits +; debits -)(1) 1985 1986 1987
 TABLE: I II III IV I II III IV I II III IV
 TABLE: Line (Credits +; debits -)(1) 1988
 TABLE: Line
 TABLE: I(p)


(1)Credits, +: Exports of goods and services; unilateral transfers to United States; capital inflows (increase in foreign assets (U.S. liabilities) or decrease in U.S. assets); decreasee in U.S. official reserve assets; increase in foreign official assets in the United States.

(p)Preliminary

TABLE 2. -- U.S. International Transactions -- Seasonally Adjusted (Millions of dollars)
 TABLE: Line (Credits +; debits -)(1) 1982 1983 1984
 TABLE: I II III IV I II III IV I II III IV
 TABLE: Line (Credits +; debits -)(1) 1985 1986 1987
 TABLE: I II III IV I II III IV I II III IV
 TABLE: Line (Credits +; debits -)(1) 1988
 TABLE: Line
 TABLE: I(p)


(1)Credits, +: Exports of goods and services; unilateral transfers to United States; capital inflows (increase in foreign assets (U.S. liabilities) or decrease in U.S. assets); decrease in U.S. official reserve assets; increase in foreign official assets in the United States.

(p)Preliminary

TABLE 3. -- U.S. Merchandise Trade (Millions of dollars)
 TABLE: Line 1978 1979 1980 1981 1982 1983 1984 1985 1986 1987
 TABLE: Not seasonally adjusted Seasonally adjusted
 TABLE: Line 1986 1987 1988 1986 1987 1988 Line
 TABLE: I II III IV I II III IV I(P) I II III IV I II III IV I(P)


(p)Preliminary

TABLE 4. -- Selected U.S. Government Transactions (Millions of dollars)
 TABLE: 1986 1987 1988
 TABLE: Line 1985 1986 1987 I II III IV I II III IV I(p)


(p)Preliminary

TABLE 5. -- Direct Investment: Income, Capital, Royalties and License Fees, and Other Private Services (Millions of dollars)
 TABLE: Line (Credits +; debits -) 1985 1986 1987 1986 1987
 TABLE: I II III IV I II III IV
 TABLE: Line (Credits +; debits -) 1988
 TABLE: I(p)


(p)Preliminary

TABLE 6. -- Securities Transactions (Millions of dollars)
 TABLE: Line (Credits +; debits -) 1985 1986 1987 1986 1987
 TABLE: I II III IV I II III IV
 TABLE: Line (Credits +; debits -) 1988
 TABLE: I(p)


(p)Preliminary

TABLE 7. -- Claims on and Liabilities to Unaffiliated Foreigners Reported by U.S. Nonbanking Concerns (Millions of dollars)
 TABLE: Line (Credits +; increase in U.S. liablities 1985 1986 1987
 TABLE: or decrease in U.S. assets.
 TABLE: Debits -; decrease in U.S. liabilities
 TABLE: or increase in U.S. assets.)
 TABLE: 1986


TABLE: Line (Credits +; increase in U.S. liabilities
 TABLE: or decrease in U.S. assets.
 TABLE: Debits -; decrease in U.S. Liabilities
 TABLE: or increase in U.S. assets.) I II III IV
 TABLE: 1987 1988
 TABLE: Line Credits +; increase in U.S. liabilities
 TABLE: or decrease in U.S. assets.
 TABLE: Debits -; decrease in U.S. liabilities
 TABLE: or decrease in U.S. assets.) I II III IV(p) I
 TABLE: Amounts outstanding
 TABLE: Line (Credits +; increase in U.S. liabilities December 31, 1987
 TABLE: Debits -; decrease in U.S. liabilities
 TABLE: or increase in U.S. assets.)


(p)Preliminary

TABLE 8. -- Claims on Foreigners Reported by U.S. Banks (Millions of dollars)
 TABLE: Line (credits +; decrease in U.S. assets.
 TABLE: Debits -; increase in U.S. assets.) 1985 1986 1987
 TABLE: 1986 1987
 TABLE: Line (Credits +; decrease in U.S. assets.
 TABLE: Debits -; increase in U.S. assets.) I II III IV I II III IV
 TABLE: 1988 Amounts out-
 TABLE: Line (Credits +; decrease in U.S. assets. standing March
 TABLE: Debits -; increase in U.S. assets.) I(p) 31, 1988


(p)Preliminary

TABLE 9. -- Foreign Official Assets and Other Foreign Assets in the United States Reported by U.S. Banks (Millions of dollars)
 TABLE: Line (Credits +; increase in foreign assets. 1985 1986 1987
 TABLE: Debits -; decrease in foreign assets.)
 TABLE: 1986 1987


TABLE: Line (Credits +; increase in foreign assets.
 TABLE: Debits -; decrease in foreign assets.) I II III IV I II III IV
 TABLE: 1988 Amounts out-
 TABLE: Line (Credits +; increase in foreign assets. standing March
 TABLE: Debits -; decrease in foreign assets.) I(p) 31, 1988


(p)Preliminary

TABLE 10. -- U.S. International Transactions by Area (Millions of dollars)
 TABLE: Western Europe EC(10)(12)
 TABLE: Line (Credits +; debits -)(1)
 TABLE: 1985 1986 1987 1985
 TABLE: European United Kingdom
 TABLE: Line (Credits +; debits-)(1) Communities(12)(12)
 TABLE: 1986 1987 1985 1986 1987


TABLE: Line (Credits +; debits -)(1) European Communites (6)(13)
 TABLE: 1985 1986 1987
 TABLE: Line (Credits+; debits -)(1) Eastern Euprope Canada
 TABLE: 1985 1986 1987 1985 1986 1987
 TABLE: Line (Credits +; debits -)(1) Latin America Republics and TABLE:
 Other Western Hemisphere
 TABLE: 1985 1986 1987
 TABLE: Line (Credits +; debits -)(1) Japan Australia, New
 TABLE: Zealand, South
 TABLE: Africa
 TABLE: 1985 1986 1987 1985 1986 1987
 TABLE: Line (Credits +; debits -)(1) Line


TABLE 10. -- U.S. International Transactions, by AREA -- Continued
 TABLE: Other coutries in International
 TABLE: Asia and Africa organizations
 TABLE: Line (Credits +; debits -)(1) and un- TABLE:
 allocat


ed(14)
 TABLE: 1985 1986 1987 1985 1986 1987
 TABLE: Western Europe
 TABLE: Line (Credits +; debits -)(1) 1987 1988
 TABLE: I II III IV I(p)
 TABLE: European Communities(12)(12)
 TABLE: Line (Credits +; debits -)(1) 1987 1988
 TABLE: I II III IV I(p)
 TABLE: United Kingdon
 TABLE: Line (Credits +; debits -)(1) 1987 1988
 TABLE: I II III IV I(p)
 TABLE: European Communities(6)(13)
 TABLE: Line (Credits +; debits -)(1) 1987 1988 Line
 TABLE: I II III IV I(p)


TABLE 10. -- U.S. International Transactions, by Area -- Continued
 TABLE: Eastern Europe Canada
 TABLE: Line (Credits +; debits -)(1 1987 1988 1987 1988
 TABLE: I II III IV I(p) I II III IV I(p)
 TABLE: Latin American Republics and
 TABLE: Other Western Hemisphere
 TABLE: Line (Credits +; debits -)(1) 1987 1988
 TABLE: I II III IV I(p)
 TABLE: Japan
 TABLE: Line (Creddits +; debits -)(1) 1987 1988
 TABLE: I II III IV I(p)
 TABLE: Australia, New Zealand, and
 TABLE: South Africa
 TABLE: Line (Credits +; debits -)(1) 1987 1988 Line
 TABLE: I II III IV I(p)


TABLE 10. -- U.S. International Transactions, by Area -- Continued
 TABLE: Other countries in Asia and Africa
 TABLE: Line (Credits +; debits -)(1) 1987 1988
 TABLE: I II III IV I(p)
 TABLE: International organizations and
 TABLE: unallocated(14)
 TABLE: Line (Credits +; debits -)(1) 1987 1988
 TABLE: I II III IV I(p)


TABLE 10a. -- U.S. International Transactions, by Selected Countries (published annually) (Millions of dollars)
 TABLE: Belgium-Luxembourg
 TABLE: Line (Credits +; debits -)(1) 1985 1986 1987(p)
 TABLE: France
 TABLE: Line (Credits +; debits -)(1) 1985 1986 1987(p)
 TABLE: Germany
 TABLE: Line (Credits +; debits -)(1) 1985 1986 1987(p)
 TABLE: Italy
 TABLE: Line (Credits +; debits -)(1) 1985 1986 1987(p)
 TABLE: Netherlands
 TABLE: Line (Credits +; debits -)(1) 1985 1986 1987(p)
 TABLE: Mexico
 TABLE: Line (Credits +; debits -)(1) 1985 1986 1987(p)
 TABLE: Venezuela
 TABLE: Line (Credits +; debits -)(1) 1985 1986 1987(p)
 TABLE: Australia
 TABLE: Line (Credits +; debits -)(1) 1985 1986 1987(p)
 TABLE: South Africa
 TABLE: Line (Credits +; debits -)(1) 1985 1986 1987(p) Line (p)Prelim
inary


(1)Credits, +: Exports of goods and services; unilateral transfers to United States; capital inflows (increase in foreign assets (U.S. liabilities) or decrease in U.S. assets); decrease in U.S. official reserve assets; increase in foreign official assets in the United States.

(12)The "European Communities (10)" includes the "European Communities (6)," United Kingdom, Denmark, Ireland, and Greece. "European Communities (12)" reflects the admission of Spain and Portugal in 1986.

(13)The "European Communities (6)" includes Belgium, Germany, Italy, Luxembourg, Netherlands, European Atomic Energy Community, European Coal and Steel Community, and European Investment Bank.

(14)Includes, as part of international and unallocated, the estimated direct investment in foreign affiliates engaged in international shipping, in operating oil and gas drilling equipment that is moved from country to country during the year, and in petroleum trading.
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Author:Scholl, Russell B.
Publication:Survey of Current Business
Date:Jun 1, 1988
Words:6308
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