Falling oil prices put the Government in a difficult situation, economist Dr Ronald Ramkissoon said yesterday. Commenting on the decision by OPEC not to reduce output, he said: "An oil economy must
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T&T scores US$31.8m surplus
During the third quarter of 2013, the balance of payments (BOP) registered an overall surplus of US$31.8 million, an improvement over the deficit of US$399.1 million in the third quarter of 2012, the Central Bank said in its Economic Bulletin for January 2014. The BOP is the method countries use to monitor all trades—inflows and outflows of US dollars—conducted by the private and public sectorsto determine how much money is going in and out of a country.
“Gross official reserves therefore climbed to US$9.42 billion at the end of September 2013 after dipping slightly to US$9.18 billion at the end of the first quarter of 2013. The external current account was estimated to have posted a surplus of US$2.24 billion in the third quarter of 2013 period compared with a surplus of US$1.36 billion in the corresponding period one year ago,” the Central Bank reported≥
The improvement in the current account mainly reflected significantly lower outflows of investment income—in the form of dividends and reinvested earnings—as well as an improved services account. Initial estimates suggest that for the year as a whole, the external account registered a surplus of US$786.3 million, with a significant part of this surplus due to inflows from an external (US$550 million) bond issued in December 2013, the bulletin said.
Preliminary estimates suggest that the merchandise trade account registered a surplus of US$2,549.2 million in the third quarter of 2013, 0.5 per cent below the surplus of US$2,561.9 million in the same period in 2012. Initial estimates suggest that energy exports remained high at US$4,243.7 million in the third quarter of 2013.
This was moderately lower than the US$4,415.9 million recorded in the corresponding period of 2012. Planned maintenance activity that started in September 2013 adversely affected production levels while energy prices were slightly lower as reflected in the year-on-year decline of 1.4 per cent in the Energy Commodity Price Index, which is based on T&T’s major energy exports, for July to September 2013.
Meanwhile, energy imports were estimated to have increased marginally (5.7 per cent) in the third quarter of 2013 as crude refining activity at Petrotrin recovered. The capital and financial account recorded a deficit of US$2,215.6 million in the third quarter of 2013. According to preliminary estimates, some net inflows of other private sector capital were mainly due to loans and currency and deposits.
Net foreign direct investment inflows declined from US$543.0 million in the third quarter of 2012 to US$410.8 million in the third quarter of 2013. Commercial banks reduced their net foreign balances abroad leading to net inflows. This was mainly due to a decline in holdings of US treasury bills. On the public sector sub-account, the deficit declined to US$262.3 million in the third quarter of 2013 from US$369.6 million in the third quarter of 2012.