It is an economic term that refers to the economic transactions carried out between the citizens of the country that produces it and the citizens of other countries. It is a very important document for specialists who are dedicated to analyzing the macroeconomic behavior of a nation.
The balance of payments is an accounting record, where all the transactions carried out by a country during a fiscal year (generally a year of time) are expressed, in accordance with accounting principles.
In other words, the balance of payments shows us the operational behavior of a country with the rest of the world, that is, the international transactions carried out during its exercise.
These transactions include payments for exports and imports of the country, goods, services, financial transfers and financial capital.
Thus, exports or income generated through loans and investments are recorded in positive data. On the other hand, the use of resources to carry out imports or investments abroad is recorded as negative data.
Consequently, if a country imports more than it exports, its balance of payments or trade will be in deficit (with a negative result). On the contrary, if the amount of money obtained from exports exceeds the amount used to pay for imports or loans, the result will be a balance of payments surplus (with a positive result).
By including all the components of the balance of payments, the total sum of the positive and negative data must give zero, eliminating the possibility of a surplus or deficit, since that is exactly what the balance, the balance of the nation, seeks to avoid. economic distortions.
The calculations are made in a single currency, usually in the official currency of the country that makes the balance.
Today, all the countries of the world function as “open economies”, which means that to a greater or lesser extent they maintain commercial and financial relations with other countries.
This connection occurs through exports and imports of goods and services. In turn, this phenomenon demonstrates the interdependence that can be generated between nations, where the disturbances that occur in the economic development of a country can affect the levels of operation, production and employment of its trading partners.
