Taiwan recorded a net outflow in its financial account for the 30th consecutive quarter in the fourth quarter of last year, the longest run in history, the central bank said.
The bank on Friday said that the nation’s net outflow in its financial account for the October-to-December period totaled US$21.06 billion, bringing the aggregate net fund outflow to US$354.07 billion, which it said is equivalent to the cost of building 182 Taipei 101 skyscrapers and 23 high-speed rail systems.
A nation’s financial account measures the flow of direct investment and portfolio investments.
The net outflow last year totaled US$68.64 billion, a record high.
Meanwhile, net portfolio investments held overseas by Taiwanese individuals in the fourth quarter rose by US$16.21 billion from a year earlier, with local insurance firms raising their holdings in securities and bonds in foreign markets, the bank said.
At the same time, net portfolio investments held by foreign investors residing in Taiwan increased by US$1.89 billion, the bank said.
The continued financial outflow fueled mounting concerns that investors would keep moving funds out of the nation and into US dollar-denominated assets.
However, the central bank dismissed such concerns, saying that Taiwan is one of only a few nations in the world to record a long-term current account surplus and such nations tend to register net outflows on their financial accounts.
Other nations with a long-term current account surplus and net outflows on their financial account include China, Japan, Singapore, South Korea, Germany, Malaysia and Russia, the bank said.
The current account mainly measures a nation’s merchandise and service exports.
Taiwan’s current account surplus in the fourth quarter was US$26.58 billion, up US$7.06 billion, or 36.2 percent, from a year earlier, on the back of rising global demand and amid global economic recovery, central bank Economic Research Department Deputy Director Tsai Chiung-ming (蔡炯明) said.
The higher current account surplus also reflected a spike in raw material prices in the global market, Tsai said.
In the fourth quarter, Taiwan enjoyed a surplus of US$23.22 billion in merchandise trade, up US$4.03 billion from a year earlier, while the nation suffered a deficit of US$1.26 billion in service income, down US$890 million from a year earlier, bank data showed.
Tsai said the decline in the nation’s service income deficit resulted largely from a fall in expenses paid by Taiwanese firms and people to buy intellectual property rights.
In terms of travel income, Taiwan recorded a deficit of US$650 million in the fourth quarter, sharply down from US$2.17 billion over the same period a year earlier.
However, it was the eighth consecutive quarter in which the nation recorded a deficit in travel income.
Last year, the current account surplus totaled US$84.09 billion, a new record, accounting for 14.7 percent of GDP, the bank said.
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