Taiwan remains the fifth largest net creditor in the world
Taipei, June 15 (CNA) Taiwan remained the world’s fifth largest net creditor at the end of 2020 as the country saw its net international investment position (NIP) reach a new high, the central bank said on Tuesday.
According to the central bank, NIIP is the difference between a country’s external financial assets and its external financial liabilities.
At the end of last year, Taiwan’s foreign assets stood at US $ 2.492 trillion and its external liabilities reached US $ 1.121 billion at the end of last year.
These figures translated into Taiwan’s NIIP reaching an all-time high of US $ 1.371 trillion at the end of 2020, up US $ 23.25 billion or 1.7% from the previous year. previous year, the central bank said.
A country’s external liabilities include public and private debt, with external assets held publicly and privately by legal residents of a country also being taken into account when calculating the NIP.
The central bank said Taiwan’s NIIP is the fifth in the world, behind Japan’s $ 3.7.2 trillion, Germany’s $ 3.128 trillion, Hong Kong’s $ 2.1528 trillion, and 2 1503 billion dollars from China. Hong Kong has moved up a notch in the rankings, replacing China as the world’s third largest net creditor as the Chinese territory saw its assets rise but its liabilities decline, according to the central bank.
The central bank said Taiwan’s net assets at the end of last year rose 10.5% from a year earlier, with Taiwanese life insurance companies holding more foreign securities.
The central bank added that Taiwan’s net liabilities grew even more than 23.5 percent as the value of securities held by foreign investors rose significantly.
In 2020, the Taiex, the weighted benchmark of the Taiwan Stock Exchange, climbed 22.8% from the previous year, largely thanks to abundant liquidity despite the COVID-19 pandemic.
In addition to a high-flying stock market, the central bank said, the increase in external liabilities was also the result of an improvement in the bond market, further increasing the value of assets held by foreign investors.
The central bank said the United States remained the world’s largest net debtor at the end of 2020 with external liabilities hitting a new high of over $ 14 trillion.