Which Countries Run Current Account Surpluses? Deficits?

Paulina Restrepo-Echavarria: Given that we know that if someone is running a current account deficit, someone must be running a current account surplus, then who are these countries who are running the current account surpluses, and who else is running a current account deficit? So let's take a look at that.

So here we have a map of all over the world. And in red, you see the countries that are running a current account deficit. And in green you have the countries that are running a current account surplus. So the brightest red is representing the largest current account deficits, and the strongest green is showing you the largest current account surpluses.

So you can see that the US is, of course, the country running the biggest current account deficit here. And the other countries that are running current account deficits are Canada, for example, Argentina, Brazil, Australia, India, Spain, the UK-- to name a few.

So does this make sense? Is this natural to expect or not natural to expect? So I think it is. Why is this the case?

So we have countries, for example, like Australia. Take Australia for a moment. Australia is an island, and they have very particular climates-- very particular geography. As such, it's natural to expect that them as a country cannot produce every single good that they would like to consume. So to that extent, they probably need to import a lot of goods in order to satisfy their consumption needs. And that's what we are seeing in the data. That's the case for them.

Then, take Canada. Canada is a country that specializes in the production of few goods. Also, because of the climate there, a lot of goods don't grow when it comes to agriculture and so on. So it's also natural to expect that they're going to be importing a lot of goods.

And then we have countries that are mainly exporters. The main exporters here are China, which is the biggest one, Saudi Arabia-- so Saudi Arabia is the one-- let's see, this one here-- Russia-- up here-- and Japan-- actually here is also a big exporter. So these countries are mainly shipping goods and services outside their country more than what they are receiving. So their current accounts are in surplus. So you can see that's a wide variety. Some countries are debtors, some countries are lenders.