Balance of payments

Amounts are in millions (M.kr.)

Data on balance of payments are collected to measure Iceland's foreign direct investment (FDI) transactions and positions with non-residents. The Central Bank also uses the data in its operations.

Statistical reporting on balnce of payments is carried out according to the standards defined by the Organization for Economic Co-operation and Development (OECD) in the OECD Benchmark Definition of Foreign Direct Investment - 4th Edition (BMD4). The BMD4 defines presentation, methodology, valuation, and terminology.

The compilation of data, calculation, and publication of the balance of payments is provided for in Chapter IX of the Act on the Central Bank of Iceland, No. 92/2019 (in Icelandic) and the Foreign Exchange Act, No. 70/2021 (in Icelandic). These Acts (and the respective regulations, Rules No. 861/2022 (in Icelandic) on general reporting obligations under the Foreign Exchange Act) contain provisions on resident entities’ disclosure requirements and on the obligation of Central Bank employees to observe confidentiality concerning the data compiled for statistical reporting.

The balance of payments shows transactions between residents and non-residents over a specified period of time. It is divided into the current account balance, the capital account balance, and the financial account balance.

Statistics Iceland measures goods and services trade. The compilation of external trade in services is based mainly on annual and quarterly queries sent to firms. The commercial banks and other financial undertakings, the Treasury, the Central Bank, and other credit institutions and large non-financial firms provide monthly and quarterly or yearly information on their transactions with non-residents. Data from the Directorate of Internal Revenue and the Register of Annual Accounts are used as well.

The latest figures are always preliminary and may change if new data is received from reporting entities.

The statistics observe a fixed revision schedule, where previously published figures are revised as new information is received. If new information of significance for the statistics is received, attempts are made to update the statistics as soon as possible. The revision schedule is shown in the table below.

A major review (benchmark revision) is also carried out every 5 years.

The Central Bank of Iceland publishes statistics on Iceland’s balance of payments and international investment position in accordance with standards issued by the International Monetary Fund (IMF). The standards bear the title Balance of Payments and International Investment Position Manual, 6th ed. and were adopted by the Central Bank in September 2014. The new standards take the place of the 5th edition, implemented in Iceland in 1996.

The purpose of the standards is, among other things, to reflect external trade and the international investment position as clearly as possible. Further information on the adoption of the new standards can be found in the Bank’s Informational Report no. 5.