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

HK$ million   1999 1999 2000 2000 2000 Standard Components 3rd Qtr 4th Qtr 1st Qtr 2nd Qtr 3rd Qtr             Capital and Financial Account(1) -33,980 -14,001 -3,863 -16,019 -26,531    Capital Account -3,123 -4,533 -1,938 -3,641 -3,716       Capital transfers -3,123 -4,533 -1,938 -3,641 -3,716          General government 0 0 0 0 0          Other sectors -3,123 -4,533 -1,938 -3,641 -3,716       Non-produced and non-financial assets ... ... ... ... ...    Financial Account -30,857 -9,468 -1,925 -12,378 -22,815       Financial non-reserve assets (net change) -18,132 42,653 -20,100 12,990 16,154          Direct investment -9,323 45,296 -1,440 58,667 21,947             Direct investment abroad -71,356 11,236 -66,715 -78,467 -34,387                Equity capital -13,926 39,278 -8,710 -99,448 -10,042                   Claims on affiliated enterprises -13,926 39,278 -8,710 -99,448 -10,042                   Liabilities to affiliated enterprises ... ... ... ... ...                Reinvested earnings -22,131 -6,265 -31,637 -21,587 -19,063                Other capital * -35,299 -21,777 -26,368 42,567 -5,283                   Claims on affiliated enterprises -32,622 -16,180 -34,465 -22,755 -3,560                   Liabilities to affiliated enterprises -2,677 -5,597 8,097 65,322 -1,723                Financial Derivatives * * * * *                   Claims on affiliated enterprises * * * * *                   Liabilities to affiliated enterprises * * * * *             Direct investment in HK 62,033 34,060 65,275 137,134 56,334                Equity capital 14,159 6,615 13,552 82,541 -15,597                   Claims on direct investors ... ... ... ... ...                   Liabilities to direct investors 14,159 6,615 13,552 82,541 -15,597                Reinvested earnings 37,824 18,941 45,828 33,161 43,647                Other capital * 10,051 8,504 5,895 21,432 28,284                   Claims on direct investors 781 -4,000 -1,663 7,072 -66                   Liabilities to direct investors 9,270 12,504 7,558 14,360 28,350                Financial Derivatives * * * * *                   Claims on direct investors * * * * *                   Liabilities to direct investors * * * * *          Portfolio investment 115,213 96,986 87,045 5,476 1,996             Assets 13,322 -93,297 27,853 -109,699 15,847                Equity securities -27,551 -45,011 -32,689 -67,373 39,205                   Banks -18 -46 -39 -92 -25                   Other sectors -27,533 -44,965 -32,650 -67,281 39,230                Debt securities 40,873 -48,286 60,542 -42,326 -23,358                   Bonds and notes 52,309 -56,082 47,565 -34,203 -5,032                      Banks -774 -20,968 -29,933 -14,493 -39,647                      Other sectors 53,083 -35,115 77,498 -19,710 34,614                   Money market instruments -11,436 7,796 12,977 -8,124 -18,326                      Banks -5,893 13,611 14,174 -12,400 -14,754                      Other sectors -5,542 -5,815 -1,197 4,276 -3,572             Liabilities 101,891 190,283 59,192 115,176 -13,851                Equity securities 78,959 221,970 58,712 116,277 -12,537                   Banks 3,211 4,945 -4,582 2,262 3,213                   Other sectors 75,748 217,025 63,294 114,015 -15,750                Debt securities 22,932 -31,687 480 -1,101 -1,314                   Bonds and notes 14,051 -34,740 3,121 -3,106 -665                      Banks -2,803 -878 -554 -1,112 -60                      Other sectors 16,854 -33,861 3,675 -1,994 -605                   Money market instruments 8,881 3,053 -2,641 2,006 -650                      Banks -405 698 1,258 3,039 -1,804                      Other sectors 9,286 2,354 -3,899 -1,033 1,154          Financial derivatives -25,998 43,855 -41,504 15,644 -1,088             Assets 22,430 50,874 5,943 22,081 9,229                Banks 2,734 50,481 5,581 20,922 5,814                Other sectors 19,696 393 362 1,159 3,415             Liabilities -48,428 -7,019 -47,447 -6,437 -10,317                Banks -47,556 -1,054 -47,002 -5,951 -9,514                Other sectors -872 -5,965 -445 -486 -803          Other investment -98,024 -143,484 -64,201 -66,797 -6,701             Assets -54,401 -58,371 33,193 79,274 47,796                Trade credits -10,360 -4,328 -7,108 -8,752 -4,376                Loans 30,679 13,044 98,596 91,578 73,248                   Banks 25,432 17,024 98,300 91,241 71,652                   Other sectors 5,247 -3,980 296 337 1,596                Currency and deposits -78,052 -61,674 -58,030 -6,016 -8,938                   Banks -79,079 -68,896 -29,401 14,039 -12,609                   Other sectors 1,027 7,222 -28,629 -20,055 3,671                Other assets 3,332 -5,413 -265 2,464 -12,138                   Banks 1,994 1,769 -265 421 -927                   Other sectors 1,338 -7,182 ... 2,043 -11,211             Liabilities -43,623 -85,113 -97,394 -146,071 -54,497                Trade credits 3,968 -1,723 -352 1,825 258                Loans -4,682 -3,649 8,881 156 6,252                   Banks 12,198 1,023 9,692 1,962 -15,286                   Other sectors -16,880 -4,672 -811 -1,806 21,537                Currency and deposits -41,923 -78,591 -107,749 -148,565 -61,658                   Banks -42,121 -77,264 -108,652 -147,102 -61,974                   Other sectors 198 -1,327 903 -1,463 316                Other liabilities -986 -1,150 1,826 514 651                   Banks 589 -1,194 467 325 90                   Other sectors -1,576 44 1,359 189 560       Reserve assets (net change)(2) -12,725 -52,121 18,175 -25,368 -38,969

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.