The SAFE recently released China 's International Investment Position for year-end 2007.
At the end of 2007, China 's external financial assets reached USD 2288.1 billion, up 39% over the end of 2006; external financial liabilities reached USD 1266.1 billion, a rise of 23% yoy; external net financial assets totaled USD 1022 billion, an increase of 67% yoy.
In terms of external financial assets, direct investments abroad totaled USD 107.6 billion, portfolio investments USD 239.5 billion, other investments USD 406.1 billion, and reserves assets USD 1,534.9 billion, accounting for 5%, 10%, 18%, and 67% respectively. In terms of external financial liabilities, foreign direct investments totaled USD 742.4 billion, portfolio investments USD 142.6 billion, and other investments USD 381 billion, accounting for 59%, 11%, and 30% respectively.
The International Investment Position (hereafter referred to as the IIP) is a statistical statement which reflects at a specific point the stocks of financial assets and liabilities of one country or region to other countries or regions of the world, and together with the balance of payments statements (BOP statements) constitutes the complete international account system of the country or region indicating the trade flows.
The SAFE has adjusted the IIP for year-end 2006 according to the latest data.
             

  China 's International Investment Position
                                                         

Unit: USD 100 million

Notes:
1. This IIP employs rounded-off numbers.
2. Net position refers to assets minus liabilities, + means net assets, and -means net liabilities.
3. Since 2006, the IIP has employed the data on stocks of foreign direct investments generated from the annual joint survey of six departments, such as the Ministry of Commerce and the Ministry of Finance, as the source of the data on foreign direct investment.

 Compilation Principles and Indexes for the IIP

I. Compilation Principles for the IIP
In accordance with the standards of the Balance of Payment Manual (Fifth Edition) published by the International Monetary Fund (IMF), the IIP is a statistical statement which reflects at a specific point the stocks of financial assets and liabilities of one country or region to other countries or regions of the world. Changes in the IIP can be caused by changes in the transactions, prices, and exchange rates as well as by other adjustments during specific periods. The IIP remains consistent with the BOP statement with regard to the principles of valuation, measurement, and conversion, and together with the BOP statement constitutes a complete international account system of the country or region.
Chinas IIP is a statistical statement which reflects at a specific point the stocks of the financial assets and liabilities of China (excluding in the following Hong Kong SAR, Macao SAR, and Taiwan Province ) to other countries or regions of the world.
II. Major IIP Indexes
According to the standards of the IMF, the items on the IIP are categorized according to assets and liabilities. The assets are divided into Chinas direct investments abroad, portfolio investments, other investments, and reserves assets, whereas the liabilities are divided into foreign direct investments, portfolio investments, and other investments. The net position refers to assets minus liabilities. The items are specifically defined as follows:
1. Direct investment refers to external investment in which an investor of one country operates an enterprise located in another country with the aim of acquiring effective control over the enterprise. It consists of direct investment abroad and foreign direct investment. Direct investment abroad includes the stocks of direct investment abroad conducted by Chinas non-financial sectors, the stocks of the capital funds and working capital appropriated by domestic banks to set up branches overseas, as well as the stocks of loans between parent companies and subsidiaries both in China and abroad and the stocks of other receivables and payables. Foreign direct investment includes the stocks of foreign direct investment absorbed by Chinas non-financial sectors, the stocks of direct investment overseas absorbed by the financial sectors (including foreign investment attracted by branches of foreign financial sectors and Chinese-funded financial sectors, and investments from the foreign party in joint financial sectors), as well as the stocks of loans between parent companies and subsidiaries both in China and abroad and the stocks of other receivables and payables.
2. Portfolio investment includes types of investment such as shares, long- and medium-term bonds, and money market instruments.  Portfolio investment assets refer to holdings of negotiable securities, such as shares, bonds, money market instruments, and derivative financial instruments, which are held by Chinese residents but issued by non-resident enterprises.  Portfolio investment liabilities refer to shares and bonds held by non-resident enterprises but issued by Chinese residents.
2.1 Equity securities mainly comprise securities in the form of stocks.
2.2 Debt securities include long-term and medium-term bonds, short-term (one year or less) bonds, and money-market instruments or transferable debt instruments such as short-term treasury notes, commercial papers, and large-sum short-term negotiable certificates of deposits.
3. Other investment refers to all financial assets and liabilities, including trade credits, loans, currency, and deposits, as well as other assets and liabilities, but excluding direct investments, portfolio investments, and reserves assets.  Long term means the contract period of the relevant financial assets/liabilities is longer than one year, whereas short term means the contract period is one year or less.
3.1 Trade credit refers to direct business credit arising from the import and export of goods between China and other countries.  Assets refer to the receivables of Chinas exporters and the advance payments by Chinas importers, whereas liabilities refer to the payables of Chinas importers and the advance receipts of Chinas exporters.
3.2 As to loans, assets refer to the external assets held by domestic institutions through providing loans to overseas institutions; liabilities refer to the loans borrowed by domestic institutions, such as loans from foreign governments, loans from international institutions, loans from foreign banks, and sellerscredits.
3.3 As to currency and deposits, assets refer to the funds deposited abroad and the foreign cash in stock held by China's financial institutions; liabilities refer to the overseas private deposits and short-term funds from foreign banks attracted by China's financial institutions, as well as other short-term funds such as loans from foreign exporters and individuals.
3.4 Other assets/liabilities refer to investments other than trade credits, loans, currency, and deposits, for example, capital paid by non-currency international institutions and other receivables and payables.
4. Reserves assets refer to external assets that can be used at any time and that are effectively controlled by the PBOC, consisting of monetary gold, special drawing rights (SDRs), the reserves position in the Fund, and foreign exchange.
4.1 Monetary gold refers to the gold held by the PBOC as reserve.
4.2 SDR is a kind of ledger assets, which is allocated by the IMF according to the capital share of its members; it can be used to repay the debt to the IMF and make up for the deficit in the balance of payments between the governments of member countries.
4.3 Reserves positions in the Fund refer to assets that are held in the ordinary accounts of the IMF and that can be freely used.
4.4 Foreign exchange refers to current assets and liabilities that are retained by the PBOC and that can be used as a means of international compensation.