1. Trade in Goods
a. Revisions in the reinvested earnings reflected the final data of multinational companies (see discussion of the same item in the Capital and Financial account). The revised data showed operating losses in dollar terms instead of profit as earlier estimated.
(NOTE: Ideally, reinvested earnings may be estimated using indicators of profitability on a monthly basis. However, because of absence of good and more frequently generated profitability indicators, export trends were used as proxy indicators of reinvested earnings. For the years 1998 and 1999, export trends served as a good indicator of profitability with the preliminary estimates approximating the actual data. However, for 2000 and 2001, actual data on reinvested earnings were significantly different compared to estimates. Thus, releases of BOP statistics beginning April 2002 do not reflect any estimates of reinvested earnings. The difficulty of estimating reinvested earnings is common even in advanced economies where large errors between preliminary estimates and final data on reinvested earnings were observed despite use of enterprise surveys.)
b. Interest expense on medium- and long-term debt reflected the exclusion of BSP’s foreign currency denominated interest payments to residents.
c. The updated data on investment income included earnings of residents from investment in foreign government- issued debt securities.