There are numerous elements that can give clues about an economy’s health status, and one of them is the current account balance, so we wanted to take a look and see which are the countries with the highest current account deficit in 2017.
A country’s current account is a component of the balance of payments, along with the capital account. Now, the current account is also made out of multiple factors, such as the balance of trade, the net primary income, and the net cash transfers. It all helps measure a country’s foreign trade. When a country has a current account surplus, it indicates that the value of its net foreign assets grew. When it has a current account deficit, it obviously means that it shrank.
For instance, the list of countries with current account surpluses in 2015 was led by China, IMF data reveals, with a whopping $304, 164 billion, followed by Germany ($280,269 billion), and Japan ($135,58 billion). By the time the next year came around, the current account balance by country in 2016 looked different, with Germany overtaking China by quite a bit, with Japan maintaining its third position. More specifically, Germany’s current account balance indicated it had $294,34 billion, while China’s had lowered to $196,38 billion.
While the terms may seem similar, and many hope to find here a list of countries by the budget deficit, this is a completely different matter. In fact, the budget deficit indicates how much a country’s government spends, compared to the money it has incoming from taxes and other sources. The list of the budget deficit by country for 2016, for instance, is led by the tiny island of Timor-Leste, whose deficit is nearly 90% of its GDP. Similarly, if you’re looking for the balance of payments data by country, you’ll only find part of a component here, since the balance of payments includes both the current account and the capital account.
One thing that is a part of the current account balance is the trade deficit. The list of the top trade deficit countries is led by the United States, which imports a lot more than it exports. The list for trade deficit by country in 2015, for instance, saw the United States with over $800 billion more in imports than in exports. If you’re interested in data about world trades, you might also want to read up on the countries that export the most fruit in the world, as well as the easiest countries to export to.
Nonetheless, to create our list today, we checked out the data coming from the International Monetary Fund (IMF) who ran some estimates on how the current account balance looks for each country for the next few years. Unsurprisingly, the IMF’s data is usually pretty accurate, so there should be no issues with the numbers here. We had two options here – use the straight-out numbers, the values in billions of dollars for each country’s deficit, or choose to see what those numbers actually mean for each country. So what’s the current account balance as a percentage of GDP meaning? Well, this percentage perfectly relays the macroeconomic instability in the country, which is not necessarily conducive to sustained economic growth, regardless if we’re talking about surplus or deficit, as neither is ideal.
That being said, here are the countries with the highest current account deficit in 2017.