U.S. international transactions in 2007

Survey of Current Business, April, 2008 by Christopher L. Bach

Receipts of income on other private investment increased to $424.4 billion in 2007 from $335.0 billion in 2006 (table N, chart 11). Interest received on banks' claims increased $30.1 billion because of a 24 percent increase in average amounts outstanding and a 12-basis-point increase in interest rates. Income received on securities increased $36.1 billion; dividends increased $26.4 billion because of a 27 percent increase in average holdings, and interest on bonds increased $9.6 billion because of an 18 percent increase in average amounts outstanding. Interest on "other" (largely nonbank) claims increased $23.3 billion, mostly because of a 27 percent increase in average amounts outstanding.

Payments of income on other private investment increased to $411.9 billion in 2007 from $334.6 billion in 2006 (table N, chart 11). Nearly all of the increase was attributable to higher average amounts outstanding. Interest paid on banks' liabilities increased $25.9 billion as a result of higher average amounts outstanding and an 8-basis-point increase in yields. Income paid on securities increased $30.2 billion; interest on bonds increased $21.1 billion because of a 22 percent increase in average holdings, and dividends on stocks increased $9.0 billion because of an increase in average holdings. Interest paid on "other" (largely nonbank) liabilities increased $21.1 billion as a result of a 29 percent increase in average amounts outstanding and a 14-basis-point increase in yields.

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Receipts of income on U.S. government assets were $2.2 billion in 2007, down from $2.4 billion in 2006 (table O).

Payments of income on U.S. government liabilities increased to $157.2 billion in 2007 from $133.8 billion in 2006 (table O). About 80 percent of the increase was attributable to higher average amounts outstanding. Payments on Treasury bonds increased $10.8 billion, payments on agency bonds increased $11.7 billion, and payments on Treasury bills increased $1.0 billion.

Unilateral current transfers

Net unilateral current transfers to foreigners were $104.4 billion in 2007, up from $89.6 billion in 2006.

U.S. government grants were $32.7 billion, up from $27.1 billion (table O). Grants to Israel and Egypt under the credit waiver program and under economic assistance programs totaled $3.5 billion in 2007, up from $0.6 billion in 2006.

U.S. government grant disbursements for reconstruction in Iraq fell to $2.5 billion in 2007 from $4.6 billion in 2006. However, grant disbursements for operations of Afghanistan and Iraqi security forces increased to $9.4 billion from $6.5 billion.

Excluding these transactions with Israel, Egypt, and Iraq, U.S. government grants to developing countries for all other purposes were $17.3 billion in 2007, up from $15.4 billion in 2006.

Private remittances and other transfers to foreigners increased to $64.9 billion in 2007 from $55.9 billion in 2006.

Capital Account

Capital account transactions were net payments (outflows) of $2.3 billion in 2007, down from $3.9 billion in 2006. (1)