Palestinian Central Bureau of Statistics and the Palestine Monetary Authority Results Announcement
Palestinian Balance of Payments – Fourth Quarter 2016 Deficit in Current Account is USD 365.1 Million
The Palestinian Central Bureau of Statistics (PCBS) and the Palestine Monetary Authority (PMA) have announced the preliminary results of the Palestinian Balance of Payments (BoP) for the Fourth quarter of 2016 under the joint issuance cycle for the Palestinian Balance of Payments (BoP). It should be noted that the data excludes that part of Jerusalem which was annexed forcefully by Israel following its occupation of the West Bank in 1967.
The preliminary results of BoP for the Fourth quarter of 2016 showed:
• An incessant deficit in the Current Account (Goods, Services, Income, Current Transfers) which totaled USD 365.1 million marking an increase of 16.1% compared to the previous quarter. This increase in deficit of the Current Account was mainly triggered by the increase in the deficit of the Trade Balance of Goods by 5.6%, which reached USD 1,126.6 million. As well as the increase of deficit in Services Balance, about 4.9%, which amounted to USD 232.5 million. This deficit occurred due to the increase of the import of transportation services in addition to other business services.
• The surplus in Income Account (compensations of employees and investments income) amounted to USD 408.6 million with an increase of 1.8% compared to the previous quarter. This surplus was due to compensations of employees working in Israel, which reached USD 396.7 million. As for the received investments income, it amounted to USD 29.6 million; and was mainly caused by the income received on the portfolio investments abroad, in addition to the interest received on deposits in banks abroad.
• The Current Transfers achieved a surplus value amounting to USD 585.4 million with an increase of 2.2% compared to the previous quarter. This was due to the increase of the transfers to the other sectors. The transfers to the government sector contributed 20.1% of total transfers from abroad, while the transfers to other sectors (mainly private sector) was 79.9%. The donors’ current transfers constituted 29.8% of total transfers from abroad.
• The results showed a surplus value for the Capital and Financial Account amounting to USD 354.5 million with an increase of 25.9% compared to the previous quarter, the surplus in the Capital and Financial Account was mainly caused by the surplus in the Capital Account which reached USD 144.7 million, and the surplus in Financial Account which amounted to USD 209.8 million. There was a decrease in the reserve assets at PMA amounting to USD 22.6 million, with a decrease of USD 66.6 million compared to the previous quarter.
It is worth mentioning that the Balance of Payments (BoP) is used to determine the economic position of a country compared to other countries worldwide, and to calculate the size of its external debt. This data enables researchers and decision makers to devise informed economic policies and development plans to improve their external balance to guarantee the stability of the state and sustain the economic growth. BoP data was prepared according to the latest international recommendations taking into account the specificity of the Palestinian situation.