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Martin Wheatcroft FCA

Financial strategy consultant. Advisor and author on public finances and financial communication.

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The Modern Professional Body

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SIMPLY UK GOVERNMENT FINANCES 2019-20

ICAEW Public Sector

Publications

ICAEW: WGA 2018-19

ICAEW: Coronavirus and
the public finances


ICAEW: Local authority
commercial investment


ICAEW: General Election 2019

ICAEW: Spending Round 2019

ICAEW: Shared and joint audits

ICAEW: Fiscal risks report

ICAEW: WGA 2017-18

ICAEW: Infrastructure
finance review


IFS & ICAEW: Public assets

IFS & ICAEW: Defence

ICAEW: EU exit charge

ICAEW: The debt of nations

IFS & ICAEW: Debt

IFS & ICAEW: Public liabilities

ICAEW: Managing the
public balance sheet


ICAEW: Funding UK
Infrastructure


IFS & ICAEW: Whole of
Government Accounts


Twitter and LinkedIn

Twitter: @mwheatcroftfca

LinkedIn: @martinwheatcroft

Blog posts

  • A difficult winter ahead for the public finances 2020-12-23
  • ICAEW chart of the week: 40 years of technology 2020-12-18
  • ICAEW chart of the week: Government bond yields 2020-12-11
  • Test and trace in England falls short despite £22bn budget 2020-12-11
  • ICAEW chart of the week: UK trade in goods 2020-12-04
  • ICAEW chart of the week: Spending Review 2020 2020-11-27
  • Spending Review 2020: public finances dominated by COVID aftermath 2020-11-26
  • What is tomorrow’s Spending Review all about? 2020-11-24
  • Public sector cash burn slows in October, but a difficult winter lies ahead 2020-11-23
  • ICAEW chart of the week: Ireland Budget 2021 2020-11-20
  • COVID tips Croydon Council over the edge into bankruptcy 2020-11-17
  • ICAEW writes to Chief Secretary on Spending Review priorities 2020-11-16
  • ICAEW chart of the week: UK claimant count 2020-11-13
  • ICAEW chart of the week: UK electricity projections 2020-11-06
  • Social value an increasingly important element to public procurement 2020-11-03
  • ICAEW chart of the week: US federal deficit 2020-10-30
  • ICAEW chart of the week: Half year public spending and receipts 2020-10-23
  • Half-year deficit reaches £208bn as COVID costs accumulate 2020-10-22
  • Where is the infrastructure for delivering infrastructure? 2020-10-19
  • ICAEW chart of the week: UK debt financing requirement 2020-10-16
  • ICAEW chart of the week: Local government in England 2020-10-09
  • ICAEW chart of the week: Quarterly GDP 2020-10-02
  • Cancelled Budget must not be allowed to delay infrastructure plans 2020-09-29
  • ICAEW chart of the week: public sector employment 2020-09-25
  • Plastic is the future for cash – one way or another 2020-09-22
  • Pandemic costs add up to a very big number 2020-09-21
  • ICAEW chart of the week: China 2020-09-18
  • Magnox contract exit cost: a small price to pay? 2020-09-16
  • ICAEW chart of the week: Foreign, Commonwealth & Development Office 2020-09-11
  • ICAEW chart of the week: United States of America 2020-09-04
  • Public sector debt hits £2tn for the first time 2020-08-21
  • £31 billion charge shines spotlight on £2.2tn pounds public sector pension liability 2020-08-21
  • Chief Secretary brands Treasury ‘new radicals in government’ 2020-08-03
  • ICAEW chart of the month: Cricket – England v West Indies 3rd Test 2020-07-31
  • Whole of Government Accounts hidden within announcements blizzard 2020-07-24
  • ICAEW chart of the week: Whole of Government Accounts 2020-07-24
  • First quarter public finances go even deeper into the red 2020-07-22
  • OBR: Pandemic worsens long-term outlook for public finances 2020-07-20
  • NAO reviews government support for exports 2020-07-20
  • ICAEW chart of the week: A square root-based recovery? 2020-07-17
  • PAC slams Ministry for local commercial investment failures 2020-07-17
  • Universal Credit improves but attracts NAO criticism 2020-07-14
  • ICAEW chart of the week: Fiscal interventions 2020-07-10
  • Further fiscal interventions focused on post-furlough future 2020-07-09
  • NAO qualifies DWP accounts for 32nd year running 2020-07-06
  • ICAEW chart of the week: UK population in lockdown 2020-07-03
  • New funding package for English local authorities 2020-07-02
  • Local authorities running out of money as COVID costs mount 2020-07-01
  • UK aircraft carrier groups won’t be operating to full extent until 2026 2020-06-26
  • ICAEW chart of the month: Cabinet government 2020-06-26
  • Public debt exceeds 100% of GDP for first time since 1963 2020-06-22
  • ICAEW chart of the week: Economic lockdown 2020-06-19
  • Treasury backs PAC in battle over recommendations 2020-06-17
  • ICAEW chart of the week: PFI contracts past their peak 2020-06-12
  • Challenges for public bodies as PFI contracts end 2020-06-08
  • ICAEW chart of the week: EU spending plans 2021-27 2020-06-05
  • ICAEW chart of the week: borrowing to exceed half a trillion pounds 2020-05-29
  • ICAEW Fiscal Insight: Coronavirus and the public finances 2020-05-28
  • April public finances awash with red ink 2020-05-27
  • ICAEW chart of the week: Money for nothing 2020-05-22
  • ICAEW chart of the week: charities 2020-05-15
  • ICAEW chart of the week: US deficit 2020-05-08
  • ICAEW chart of the week: UK gilt issues 2020-05-01
  • PAC launches local authority property investments inquiry 2020-04-27
  • ICAEW chart of the week: UK electricity usage 2020-04-24
  • ICAEW chart of the week: deficit and debt 2020-04-17
  • OBR: deficit could reach £273bn or more 2020-04-15
  • Treasury announces extra £9.5bn for public services 2020-04-14
  • ICAEW chart of the week: UK card activity 2020-04-09
  • ICAEW chart of the week: retail sales 2020-04-03
  • Health Secretary recapitalises NHS with £13.4bn write-off 2020-04-02
  • Spending Review suspension sensible, but avoid more delays 2020-04-02
  • Government watchdog sounds COVID-19 fraud risk alarm 2020-03-31
  • IFS: deficit to triple as budget contingency increases 2020-03-30
  • ICAEW chart of the week: Forecast deficit doubles in a week 2020-03-20
  • The £4.4bn cost of preparing for Brexit 2020-03-17
  • ICAEW chart of the week: Spring Budget 2020 2020-03-13
  • Spring Budget 2020: Hey big spender, spend a little infrastructure with me 2020-03-12
  • ICAEW chart of the week: Raising taxes is hard to do 2020-03-06
  • A tax system with 1,190 tax reliefs is difficult to hold accountable 2020-03-02
  • ICAEW chart of the week: UK international reserves 2020-02-21
  • ICAEW chart of the week: Public sector employment 2020-02-17
  • ICAEW chart of the week: Inflation 2020-02-07
  • ICAEW chart of the month: UK international trade 2020-01-31
  • ICAEW chart of the week: Q4 retail sales 2020-01-21
  • ICAEW chart of the week: Regional capex 2020-01-13
  • ICAEW chart of the week: A Single Market of 529m people 2020-01-07
  • ICAEW chart of the week: Post-GE2019 fiscal deficits 2019-12-16
  • ICAEW chart of the week: General Election 2019 2019-12-11
  • ICAEW Fiscal Insight: General Election 2019 2019-12-06
  • ICAEW chart of the week: Age profile of monthly public spending 2019-11-25
  • ICAEW chart of the week: Public sector capital expenditure 2019-11-20
  • ICAEW chart of the week: monthly GDP estimates to September 2019 2019-11-11
  • ICAEW chart of the week: Balance of payments 2019-11-05
  • ICAEW chart of the week: UK businesses 2019-10-29
  • ICAEW chart of the week: First half fiscal deficit 2019-10-22
  • ICAEW chart of the week: Bank of England banknotes 2019-10-15
  • ICAEW chart of the week: Ireland Budget 2020 2019-10-08
  • ICAEW chart of the week: Welsh Government Budget 2019-10-01
  • ICAEW chart of the week: fiscal changes 2019-09-24
  • ICAEW Fiscal Insight: Spending Round 2019 2019-09-19
  • ICAEW chart of the week: a trillion dollar deficit 2019-09-16
  • ICAEW chart of the week: Spending Round 2019: an ‘end to austerity’? 2019-09-09
  • ICAEW chart of the week: Schools budget up £14bn, or is it £1.2bn? 2019-09-02
  • ICAEW chart of the week: UK energy use 2019-07-29
  • Fiscal risks report 2019-07-25
  • ICAEW chart of the week: Q1 deficit 2019-07-22
  • ICAEW chart of the week: Yield curves 2019-07-15
  • ICAEW chart of the week: BBC 2019-07-08
  • ICAEW chart of the week: Department for Work & Pensions 2019-07-01
  • ICAEW chart of the week: Deficit revised for student loans 2019-06-24
  • ICAEW chart of the week: Transport for London 2019-06-17
  • ICAEW chart of the week: Infrastructure finance review 2019-06-10
  • ICAEW chart of the week: the UK public balance sheet 2019-06-03
  • ICAEW chart of the week: Whole of Government Accounts 2017-18 2019-05-28
  • ICAEW chart of the week: EU net contributors and net recipients 2019-05-20
  • ICAEW chart of the week: US external trade 2019-05-13
  • ICAEW chart of the week: European surpluses and deficits 2019-05-07
  • ICAEW chart of the week: A rush of capital spending in March 2019-04-29
  • ICAEW chart of the week: UK Government financial asset sales 2019-04-23
  • ICAEW chart of the week: UK population over the next 25 years 2019-04-15
  • ICAEW chart of the week: Australia fiscal surplus 2019-04-08
  • ICAEW chart of the week: Housing sales 2019-04-02
  • ICAEW chart of the week: Ireland external trade 2019-03-25
  • Chancellor has his chequebook out, but has not opened it yet, says ICAEW 2019-03-21
  • ICAEW chart of the week: UK Government financing for 2019-20 2019-03-18
  • ICAEW chart of the week: OBR forecast revisions UPDATED FOR SPRING STATEMENT 2019-03-13
  • ICAEW chart of the week: UK GDP over the last two decades 2019-03-04
  • ICAEW chart of the week: A resurgence of Quangos? 2019-02-25
  • Government departments will have to fight harder for public money, say ICAEW 2019-02-21
  • ICAEW chart of the week: UK international trade 2019-02-18
  • ICAEW chart of the week: UK railway finances 2019-02-11
  • ICAEW chart of the week: UK Defence Equipment Plan 2019-02-04
  • ICAEW chart of the week: UK workforce statistics 2019-01-28
  • Brexit uncertainty a concern for the public sector finances, say ICAEW 2019-01-23
  • ICAEW chart of the week: EU budget 2019 2019-01-21
  • ICAEW chart of the week: Austerity in English local authorities 2019-01-14
  • ICAEW chart of the week: The global economy in 2019 2019-01-07
  • ICAEW chart of the week: Santa’s UK P&L 2018-12-24
  • ICAEW chart of the week: Retail spending 2018 2018-12-18
  • ONS moves the goalposts with new treatment of student loans 2018-12-17
  • ICAEW chart of the week: Scottish Budget 2018-12-13
  • ICAEW chart of the week: Public order 2018-12-05
  • ICAEW chart of the week – UK foreign reserves 2018-11-28
  • ICAEW chart of the week – Export credit guarantees 2018-11-21
  • ICAEW chart of the week – Budget 2018 spending measures 2018-11-14
  • ICAEW chart of the week – Forecast public sector net debt 2018-11-08
  • ICAEW chart of the week – UK Budget 2018 2018-10-30
  • ICAEW chart of the week – NATO 2018-10-24
  • IFS Green Budget 2018 – ICAEW: Defence 2018-10-16
  • IFS Green Budget 2018 – ICAEW: Public sector assets 2018-10-16
  • ICAEW chart of the week – UK Armed Forces 2018-10-16
  • ICAEW chart of the week – Public assets 2018-10-09
  • ICAEW chart of the week – Oil prices 2018-10-03
  • ICAEW chart of the week – RPI 2018-10-01
  • ICAEW chart of the week – What we do 2018-09-20
  • ICAEW chart of the week – Fuel duties 2018-09-12
  • ICAEW chart of the week – Coins 2018-09-04
  • ICAEW chart of the week – Cricket 2018-07-25
  • ICAEW chart of the week – Fiscal forecast 2018-07-17
  • ICAEW chart of the week – Regional imbalances 2018-07-10
  • ICAEW chart of the week – EU financial settlement 2018-07-03
  • ICAEW chart of the week – Bank of England 2018-06-26
  • ICAEW chart of the week – NHS 2018-06-20
  • ICAEW chart of the week – Public spending health squeeze 2018-06-11
  • Chart of the week – 300 years of public spending 2018-06-04
  • ICAEW chart of the week – Italy 2018-05-23
  • ICAEW chart of the week – East Coast main line 2018-05-17
  • ICAEW chart of the week – Fastest growing public debt 2018-05-08
  • ICAEW chart of the week – Public debt to revenue 2018-05-01
  • ICAEW chart of the week – Interest rate exposure 2018-04-24
  • ICAEW Better Government Series: The debt of nations 2018-04-18
  • ICAEW chart of the week – Public debt 2018-04-17
  • ICAEW chart of the week – A trade war looms? 2018-04-10
  • ICAEW chart of the week – income tax distribution 2018-04-04
  • ICAEW chart of the week – Changing taxes 2018-03-27
  • ICAEW chart of the week – Public spending profile 2018-03-22
  • ICAEW chart of the week – Spring Statement 2018 2018-03-13
  • ICAEW chart of the week – A complicated tax system 2018-03-07
  • ICAEW chart of the week – Global public spending 2018-02-27
  • ICAEW chart of the week – International development aid 2018-02-19
  • ICAEW chart of the week – UK international trade 2018-02-06
  • ICAEW chart of the week – Global GDP 2018-01-30
  • ICAEW chart of the week – PFI contract profile 2018-01-24
  • ICAEW chart of the week – UK public spending 2017-18 2018-01-22
  • ICAEW chart of the week – EU Budget 2018 2018-01-10
  • ICAEW chart of the week – Health spending 2018-01-03
  • ICAEW chart of the week – Santa’s balance sheet 2017-12-19
  • ICAEW chart of the week – Public spending 2018-19 2017-12-11
  • ICAEW chart of the week – EU exit charge 2017-12-05
  • ICAEW chart of the week – Autumn Budget 2017 tax measures 2017-11-28
  • ICAEW chart of the week – Autumn Budget 2017 2017-11-23
  • Managing the Public Balance Sheet 2017-11-16
  • ICAEW chart of the week – UK trade with the rest of the world 2017-11-14
  • ICAEW chart of the week – PFI contracts 2017-11-09
  • ICAEW chart of the week – Taxes and other income 2017-11-01
  • ICAEW chart of the week – Public spending 2017-10-24
  • ICAEW chart of the week – Deficit reduction 2017-10-17
  • ICAEW chart of the week – EU Budget 2017 2017-10-04
  • A billion pounds is a lot of money. Or is it? 2017-10-01

Tag: current account deficit

ICAEW chart of the week: Balance of payments

Chart: Balance of payments 2018. Current account -£93bn (trade -£38bn, primary income -£29bn, secondary income -£26bn), capital account -£3bn, financial account +£96bn (investment +£77bn, errors and omissions +£19bn).

Although most of the focus on the balance of payments is on trade, i.e. imports and exports of goods and services, it is not the only element in the balance of payments equation, as the #icaewchartoftheweek illustrates.

Based on the 2019 Pink Book published by the Office for National Statistics last week, the balance of payments between the UK and the rest of the world in 2018 comprised a current account deficit of £93bn and a capital account deficit of £3bn, balanced by net inward investment of £77bn and errors and omissions of £19bn.

The current account deficit remains high by historical standards and was equivalent to 4.3% of GDP in 2018, up from 3.5% of GDP in 2017.

The current account deficit incorporates a trade deficit of £38bn, with imports of £680bn exceeding exports of £642bn. This reflects a surplus in services of £104bn that was more than outweighed by a deficit in goods of £142bn.

The primary income deficit of £29bn reflected £242bn in outflows – mainly investment income paid to foreign investors – less £213bn coming into the UK, while the secondary income deficit of £26bn reflects contributions to international institutions (including the EU), international development assistance, remittances and other net transfers.

Capital flows of £3bn reflect both sales of non-financial assets, and capital grants to other countries.

Inward investment of £178bn comprised direct investment in UK businesses of £28bn and £151bn of equity and debt investments, less a net £1bn movement in other forms of investment. Outward investments amounted to £101bn, with direct investments in foreign businesses of £29bn and £204bn in other movements (including currency changes), less net sales of £132bn of equity and debt investments.

Unfortunately, getting the balance of payments to actually balance is quite difficult and so the ONS has plugged the difference between the current, capital and financial accounts with £19bn in ‘errors and omissions’. The ONS will continue to revise the statistics over time, with the aim of improving the accuracy of the components reported.

Although the precise numbers will continue to be refined, the overall picture presented by the ONS is unlikely to change. The UK continues to buy more than it sells, pays out more to foreign investors than is earned from foreign investments, and transfers money to the rest of the world; with finance provided by foreign investors.

For more information about the Balance of Payments, visit UK Balance of Payments, The Pink Book: 2019.

Table: Balance of payments 2018
Posted on 2019-11-052020-07-31Categories #icaewchartoftheweekTags balance of payments, chartoftheweek, current account deficit, economy, pink book, trade deficitLeave a comment on ICAEW chart of the week: Balance of payments
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