Table 3 Hong Kong's Balance of Payments Sub-account Components:   Capital and Financial Account

HK$ million   1999 1999 1999 1999 2000 2000 Standard Components Annual 2nd Qtr 3rd Qtr 4th Qtr 1st Qtr 2nd Qtr Capital and Financial Account(1) -76,237 -13,999 -33,980 -14,001 -3,863 -16,019    Capital Account -13,787 -3,047 -3,123 -4,533 -1,938 -3,641       Capital transfers -13,787 -3,047 -3,123 -4,533 -1,938 -3,641          General government 0 0 0 0 0 0          Other sectors -13,787 -3,047 -3,123 -4,533 -1,938 -3,641       Non-produced and non-financial assets ... ... ... ... ... ...    Financial Account -62,450 -10,952 -30,857 -9,468 -1,925 -12,378       Financial non-reserve assets (net change) 11,690 -9,003 -18,132 42,653 -20,100 12,990          Direct investment 24,615 -13,983 -9,323 45,296 -1,440 58,667             Direct investment abroad -154,336 -58,631 -71,356 11,236 -66,715 -78,467                Equity capital 14,835 439 -13,926 39,278 -8,710 -99,448                   Claims on affiliated enterprises 14,695 525 -13,926 39,278 -8,710 -99,448                   Liabilities to affiliated enterprises 140 -86 ... ... ... ...                Reinvested earnings -62,774 -17,447 -22,131 -6,265 -31,637 -21,587                Other capital * -106,397 -41,623 -35,299 -21,777 -26,368 42,567                   Claims on affiliated enterprises -104,202 -44,555 -32,622 -16,180 -34,465 -22,755                   Liabilities to affiliated enterprises -2,194 2,933 -2,677 -5,597 8,097 65,322                Financial Derivatives * * * * * *                   Claims on affiliated enterprises * * * * * *                   Liabilities to affiliated enterprises * * * * * *             Direct investment in HK 178,951 44,648 62,033 34,060 65,275 137,134                Equity capital 23,322 2,020 14,159 6,615 13,552 82,541                   Claims on direct investors ... ... ... ... ... ...                   Liabilities to direct investors 23,322 2,020 14,159 6,615 13,552 82,541                Reinvested earnings 100,167 21,910 37,824 18,941 45,828 33,161                Other capital * 55,463 20,718 10,051 8,504 5,895 21,432                   Claims on direct investors -19,730 -12,446 781 -4,000 -1,663 7,072                   Liabilities to direct investors 75,193 33,164 9,270 12,504 7,558 14,360                Financial Derivatives * * * * * *                   Claims on direct investors * * * * * *                   Liabilities to direct investors * * * * * *          Portfolio investment 250,472 5,222 115,213 96,986 87,045 5,476             Assets -197,586 -71,412 13,322 -93,297 27,853 -109,699                Equity securities -226,156 -140,931 -27,551 -45,011 -32,689 -67,373                   Banks -315 -52 -18 -46 -39 -92                   Other sectors -225,841 -140,879 -27,533 -44,965 -32,650 -67,281                Debt securities 28,570 69,519 40,873 -48,286 60,542 -42,326                   Bonds and notes 32,793 68,494 52,309 -56,082 47,565 -34,203                      Banks -37,273 -6,364 -774 -20,968 -29,933 -14,493                      Other sectors 70,065 74,858 53,083 -35,115 77,498 -19,710                   Money market instruments -4,222 1,025 -11,436 7,796 12,977 -8,124                      Banks 7,283 1,025 -5,893 13,611 14,174 -12,400                      Other sectors -11,505 ... -5,542 -5,815 -1,197 4,276             Liabilities 448,058 76,634 101,891 190,283 59,192 115,176                Equity securities 456,600 88,210 78,959 221,970 58,712 116,277                   Banks 16,575 5,116 3,211 4,945 -4,582 2,262                   Other sectors 440,025 83,094 75,748 217,025 63,294 114,015                Debt securities -8,542 -11,576 22,932 -31,687 480 -1,101                   Bonds and notes -25,840 -11,208 14,051 -34,740 3,121 -3,106                      Banks -5,173 -1,664 -2,803 -878 -554 -1,112                      Other sectors -20,666 -9,544 16,854 -33,861 3,675 -1,994                   Money market instruments 17,298 -368 8,881 3,053 -2,641 2,006                      Banks 5,859 4,464 -405 698 1,258 3,039                      Other sectors 11,438 -4,832 9,286 2,354 -3,899 -1,033          Financial derivatives 95,475 92,328 -25,998 43,855 -41,504 15,644             Assets 186,457 95,030 22,430 50,874 5,943 22,081                Banks 160,305 93,696 2,734 50,481 5,581 20,922                Other sectors 26,152 1,334 19,696 393 362 1,159             Liabilities -90,982 -2,702 -48,428 -7,019 -47,447 -6,437                Banks -79,204 -2,228 -47,556 -1,054 -47,002 -5,951                Other sectors -11,778 -474 -872 -5,965 -445 -486          Other investment -358,872 -92,570 -98,024 -143,484 -64,201 -66,797             Assets 327,012 80,066 -54,401 -58,371 33,193 79,274                Trade credits -24,561 -7,073 -10,360 -4,328 -7,108 -8,752                Loans 330,462 89,293 30,679 13,044 98,596 91,578                   Banks 299,944 56,177 25,432 17,024 98,300 91,241                   Other sectors 30,517 33,116 5,247 -3,980 296 337                Currency and deposits 29,465 2,542 -78,052 -61,674 -58,030 -6,016                   Banks -41,996 -1,896 -79,079 -68,896 -29,401 14,039                   Other sectors 71,461 4,438 1,027 7,222 -28,629 -20,055                Other assets -8,354 -4,696 3,332 -5,413 -265 2,464                   Banks 139 -2,548 1,994 1,769 -265 421                   Other sectors -8,493 -2,148 1,338 -7,182 ... 2,043             Liabilities -685,884 -172,636 -43,623 -85,113 -97,394 -146,071                Trade credits 3,032 1,888 3,968 -1,723 -352 1,825                Loans -51,310 -37,860 -4,682 -3,649 8,881 156                   Banks -13,392 -19,534 12,198 1,023 9,692 1,962                   Other sectors -37,918 -18,326 -16,880 -4,672 -811 -1,806                Currency and deposits -639,986 -138,049 -41,923 -78,591 -107,749 -148,565                   Banks -638,569 -138,049 -42,121 -77,264 -108,652 -147,102                   Other sectors -1,418 ... 198 -1,327 903 -1,463                Other liabilities 2,380 1,385 -986 -1,150 1,826 514                   Banks 970 1,240 589 -1,194 467 325                   Other sectors 1,408 145 -1,576 44 1,359 189       Reserve assets (net change)(2) -74,140 -1,949 -12,725 -52,121 18,175 -25,368

Notes: (1) In accordance with the Balance of Payments accounting rules, a positive value for the balance figure in the current account represents a surplus whereas a negative value represents a deficit. For the capital and financial account, a positive value indicates a net capital and financial inflow and a negative value indicates a net outflow. As increases in external assets are debit entries and decreases are credit entries, a negative value for net change in reserve assets represents a net increase and a positive value represents a net decrease.   (2) The estimates on net change in reserve assets under the Balance of Payments framework are transaction figures. Effects from valuation changes (including price changes and exchange rate changes) and reclassifications are excluded.   ... Transaction value is insignificant (too small or close to zero).   * Financial derivatives transactions pertaining to direct investment are included in other capital of direct investment.