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Recent Trends in Japan's Balance of Payments -- Findings from the New Balance of Payments Statistics --

July 26, 2016
Noritaka Fukuma, Kentaro Morishita,* Takeshi Nakamura
International Department

  • Currently Secretariat of the Policy Board

Looking at long-term trends in the overall structure of Japan's international transactions shown in the balance of payments (BOP) statistics, the two following points related to Japanese firms are noteworthy. First, there has been a shift in exports from goods to services. And second, earnings on the accumulated stock of external assets are playing an increasingly important role as a result of an increase in Japan's outward direct investment in recent years. The new BOP statistics from 2014 onward including figures for direct investment income by region and industry as well as the external debt position (assets/liabilities) by currency make it possible to conduct more detailed analyses of the stock of external assets and liabilities. While Japanese firms make more profits from the stock of external assets, the rate of return on outward direct investment remains relatively low compared to the United States and United Kingdom, and depends heavily on the high rate of return in the manufacturing sector, particularly the transportation equipment industry in Asia.


Bank of Japan Review is published by the Bank of Japan to explain recent economic and financial topics for a wide range of readers. This report, 2016-E-8, is a translation of the original Japanese version, 2016-J-6, published in May 2016. The views expressed in the Review are those of the authors and do not necessarily represent those of the Bank of Japan.

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