SBP Economic Journalists’ Workshop Series

1. SBP Economic Journalists’ Workshop Series Covering Balance of Payments Naween A. Mangi

2. What is Balance of Payments A record of all funds going out of and coming into a country

3. Understanding the Current Account • https://www.khanacademy.org/economics-finance-domain/macroeconomics/forex-trade-topic/modal/v/balance-of-payments-current-account

4. Understanding the Capital Account • https://www.khanacademy.org/economics-finance-domain/macroeconomics/forex-trade-topic/modal/v/balance-of-payments-capital-account • https://www.khanacademy.org/economics-finance-domain/macroeconomics/forex-trade-topic/modal/v/why-current-and-capital-accounts-net-out

5. Stories in the Press • Balance of payments swings to $2.7B deficit in September (BusinessWorld Oct. 19, 2018) • The Philippines’ balance of payments (BoP) position swung to a $2.696 billion deficit last month, reversing the $1.272 billion surplus in August and the narrow $24 million surfeit in September 2017. • The BoP measures the country’s transactions with the rest of the world at a given time. A deficit means more funds fled the economy than what went in, while a surplus shows that more money entered the Philippines. • The September tally is the widest gap since a $4.48-billion deficit in January 2014, when foreign funds fled emerging markets during the “taper tantrum” as the United States Federal Reserve decided to trim its bond-buying program starting that year.

6. Stories in the Press • Turkey's current account balance posts surplus in Sept. • Turkey's current account balance showed a surplus in September for the second consecutive month this year, the Turkish Central Bank (CBRT) announced on Monday. • According to the CBRT's balance of payments report, the country's current account surplus totaled $1.83 billion in September, improving from last year's deficit of $4.4 billion. • In the previous month, the balance posted a surplus for the first time over the past three years with a $1.86-billion surplus.  • Monday's figures also met expectations, as an Anadolu Agency survey on Friday showed that a group of 19 economists had forecast a surplus of $1.97 billion on average.

7. Stories in the Press • Pakistan's immediate balance of payments crisis is over: finance minister(Dawn.comUpdated November 06, 2018) • Finance Minister Asad Umar on Tuesday claimed that Pakistan's "balance of payments crisis is over" and assured that China is committed to providing short-term relief to Pakistan as well — the modalities of which, he said, will be discussed in a new round of discussions in Beijing on Friday. • "The long-term solution to the balance of payments crisis is to increase our exports, and to do that we should have enough income so that we do not need to borrow," Umar, who was a part of the Prime Minister Imran Khan-led delegation that visited China recently, explained during a press conference today. "In this regard, we have received a commitment from the highest level.

8. Guide to Covering Economic Stories • Myth: You need formal economic training to do great stories on the economy beat • Economy stories are essentially stories about issues that affect our daily lives • Avoid dense technicalities • Report and interpret data for a lay audience • Give local flavor to big economy stories • Ask yourself how does this affect an average family; what in here can they relate to

9. Guide to Covering Economic Stories • Focus on what’s happening: as told through data or through developments • Focus on the outlook: what’s likely to happen next • Illustrate economic trends by putting names on numbers • Look at developments in economic policy • Focus on the people behind the stories • Think about conceptual scoops: spot trends in economic data before anyone else does, speak to experts and stakeholders and tell a story about what those trends mean for people and the economy

10. How to Find Stories from Numbers • Headline economic data numbers are covered in flash news • Issue is how to go beyond those headline numbers • Go regional or local: use that sub data as the basis for a story • Get reactions from stakeholders • Do preview/curtain raiser stories on what’s expected • Economy stories are actually company stories writ large • Ask questions based on the themes: • Are local businesses finding overseas markets for their products? • Are local businesses losing out to imported goods?

11. Balance of Payments Stories • Exports • Imports • Trade Balances • Foreign Investment—direct and portfolio • Home Remittances (& overseas employment) • Foreign Exchange Reserves • Home Nationals Acquiring Foreign Assets—real estate, stocks, etc

12. Factors That Impact BoP to Follow for Stories • Currency valuation • Country image • Commodity/energy prices • Policies that affect exports—e.g. amendments in incentives • Policies that affect imports—e.g. amendments in duty structure • Domestic demand • Global demand

13. Group Assignment • Form groups of three • Come up with a story idea you could pitch today relating to Pakistan’s balance of payments • Use any of the aspects of BoP we have discussed in class • Make sure your story idea has the following: • What’s the story about? Sum it up in one sentence. • Why are you writing about this now? i.e. what’s the news peg? • How will you make this story clear to a lay audience? • Who will you speak to? i.e. a sourcing plan • What’s the nut graf or the essence of the story?