Taipei, June 15 (CNA) Taiwan remained the fifth largest net creditor in the world at the end of 2020 as the county saw its net international investment position (NIIP) rise to a new high, the central bank said Tuesday.
According to the central bank, the NIIP is the difference between a country's external financial assets and its external financial liabilities.
At the end of last year, Taiwan's external assets totaled US$2.492 trillion and its external liability reached US$1.121 billion as of the end of last year
These figures translated into Taiwan's NIIP reaching a historical high of US$1.371 trillion at the end of 2020, up US$23.25 billion or 1.7 percent from a year earlier, the central bank said.
The external liability of a country includes government debt and private debt, with external assets publicly and privately held by a country's legal residents also taken into account when the NIIP is calculated.
The central bank said Taiwan's NIIP is the fifth largest in the world, trailing Japan's US$3.7210 trillion, Germany's US$3.1280 trillion, Hong Kong's US$2.1528 trillion and China's US$2.1503 trillion. Hong Kong rose one notch in the rankings, replacing China as the third largest net creditor worldwide as the Chinese territory saw its assets rise but its liability fall, according to the central bank.
The central bank said Taiwan's net assets at the end of last year rose 10.5 percent from a year earlier with Taiwanese life insurance companies holding more foreign securities.
The central bank added Taiwan's net liability rose even higher by 23.5 percent as the value of securities held by foreign investors expanded significantly.
In 2020, the Taiex, the benchmark weighted index on the Taiwan Stock Exchange, soared 22.8 percent from a year earlier, largely driven by ample liquidity despite the COVID-19 pandemic.
In addition to a high-flying equity market, the central bank said, the expanded external liability also resulted from an improving bond market, further pushing up the value of assets held by foreign investors.
The central bank said the United States remained the largest net debtor in the world at the end of 2020 with external liabilities hitting a new high of more than US$14 trillion.
