Economics (AS)·Balance of payments · NSSCAS 6.1
The balance of payments & the current account
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A country keeps a giant record book of every money transaction it has with the rest of the world — that book is the balance of payments. In this AS lesson we lay out its structure exactly the way the IMF and OECD do: the current account, the capital and financial account, and the balancing item. We then zoom in on the current account, learn to calculate its balance from real figures, and reason carefully about why a deficit arises and what it means — using Namibia's mineral-export dependence, SACU receipts and heavy import reliance as our running example.
What you'll learn in this lesson
By the end you should be able to (NSSCAS Economics (AS) 6.1):
- Describe the components of the balance of payments accounts (IMF/OECD): current account, capital and financial account, balancing item
- Analyse the causes of balance of payments disequilibrium (surplus/deficit) in the current account
- Discuss the consequences of a balance of payments disequilibrium on the current account
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Miss Hilma and Mike talk through the whole topic — with the figure and working drawn live.