Taiwan remained the fifth-largest net creditor in the world at the end of last year as the nation’s net international investment position (NIIP) reached a new high, the central bank said on Tuesday.
NIIP is the difference between a country’s external financial assets and its external financial liabilities.
At the end of last year, Taiwan’s external assets totaled US$2.492 trillion and its external liability was US$1.121 trillion.
Photo: Ritchie B. Tongo, EPA-EFE
These figures meant that Taiwan’s NIIP reached a record of US$1.371 trillion, up US$23.25 billion — or 1.7 percent — from a year earlier, the bank said.
External liability includes government and private debt, with external assets held by public entities and legal residents also taken into account for NIIP calculations.
The bank said that Taiwan’s NIIP trailed Japan’s US$3.7210 trillion, Germany’s US$3.1280 trillion, Hong Kong’s US$2.1528 trillion and China’s US$2.1503 trillion.
Hong Kong rose one notch in the rankings, replacing China as the third-largest net creditor worldwide as the territory’s assets rose and liability fell, the central bank said.
Taiwan’s net assets at the end of last year rose 10.5 percent from a year earlier, with life insurance companies holding more foreign securities, the bank said.
Taiwan’s net liability rose 23.5 percent, as the value of securities held by foreign investors expanded significantly, it said.
Last year, the TAIEX soared 22.8 percent from a year earlier, largely driven by ample liquidity, despite the COVID-19 pandemic, it said.
In addition to a high-flying equity market, the expanded external liability also resulted from an improved bond market, further pushing up the value of assets held by foreign investors, it said.
The US remained the largest net debtor in the world at the end of last year, with external liabilities hitting a new high of more than US$14 trillion, the central bank said.
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