RAMALLAH, Sunday, December 22, 2019 (WAFA) – The primary results of the International Investment Position (IIP) (external assets – foreign liabilities) for Palestine at the end of the third quarter 2019 revealed that the net IIP amounted to $2,114 million, representing an increase by 10% compared with the previous quarter, according to the Palestinian Central Bureau of Statistics (PCBS) and the Palestine Monetary Authority (PMA).
This means that the Palestinian economy’s investments outside Palestine outweighs investments in Palestine from abroad, PCBS and PMA said in a joint press release.
The total stocks of External Assets for Palestinian economy amounted to $7,423 million, the Foreign Direct Investment Abroad contributed to 4%, Portfolio Investments abroad reached 19%, while Other Foreign Investments Abroad (mainly currency and deposits) reached 69% and Reserve Assets amounted to 8%. At sectoral level, the external investments of banks sector represented a large share of the external assets, standing at 66% of the total value of external assets for Palestinian economy.
The total stocks of Foreign Liabilities in Palestine (stocks of non-residents invested in Palestine) amounted to $5,309 million, the Foreign Direct Investment in Palestine contributed to 52%, Portfolio Investments in Palestine reached 13%, and Other Investments in Palestine (mainly loans and deposits from abroad) amounted to 35%. At sectoral level, the foreign investments in banks sector contributed a major value in the foreign liabilities, represented by 37% of the total value of foreign liabilities on Palestinian economy.
The International Investment Position (IIP) is an accounting sheet that records the investments stocks for the residents in Palestine (individuals, institutions and government) invested in the rest of the world (abroad) under the name of (assets), and compares them to the investments stocks owned by residents outside Palestine (individuals, institutions and government) invested in Palestine under the name of (liabilities).
The Balance of Payments Manual - fifth edition, issued by the International Monetary Fund in 1993, divides the assets and liabilities into direct investment (investment by 10% and more in the non-resident capital), and portfolio investment (investment less than 10% in the non-resident capital as well as investment in bonds), and other investments. It divides these other investments into stocks of trade credit, loans, currency and deposits and any other assets or liabilities), in addition to the Reserve Assets, i.e. Stocks held by the Central Banks/ Monetary Authorities to address the imbalances in the balance of payments, it is worth mentioning that the reserve assets are only included in the asset side.
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