external balance

External Balance

A situation in which the money a country brings in from exports is roughly equal to the money it spends on imports. That is, external balance occurs when the current account is neither excessively positive nor excessively negative. An external balance implies capital movement. That is, a country needs to have both imports and exports to maintain an external balance; it is not sufficient simple to note no balance by not buying and selling goods. An external balance is considered sustainable. See also: Internal balance.

external balance

a situation of BALANCE OF PAYMENT EQUILIBRIUM that, over a number of years, results in a country spending and investing abroad no more than other countries spend and invest in it. The achievement of external balance is one of the macroeconomic objectives of the government. Compare INTERNAL BALANCE. See also DEMAND MANAGEMENT, EXCHANGE RATES, MACROECONOMIC POLICY, INTERNAL-EXTERNAL BALANCE MODEL.
References in periodicals archive ?
External balance situation comes to the fore as reserves dropped to $3.
The German model for resolving the debt crisis and returning to internal or external balance relies on fiscal consolidation and structural reforms for the deficit countries.
Continued strong economic performance driven by domestic and foreign direct investment, further progress in consolidating public finances, and the stabilization of external balance sheets could also support a ratings upgrade," S&P said.
KUWAIT, June 19 (KUNA) -- Global rating agency, Fitch, granted Kuwait an 'AA' rating due to the country's strong sovereign and external balance sheets for 2012, Kuwait Chamber of Commerce and Industry (KCCI) announced Tuesday.
Containing inflation, thus, is important even for improving the external balance position," it added.
The outlook on Saudi Arabia's 'AA-' (AA minus) sovereign rating remains stable, according to Capital Intelligence, supported by the large net asset position of the government, a strong external balance sheet, and a sound banking system.
A sectoral pattern of growth such as this would in fact serve the nation's longer-term needs by contributing to a better external balance.
Developed market economies continued to struggle with a slow-moving recovery, financial sector concerns, and mounting debt in 2010 while robust economic growth and improving fiscal and external balance sheets underpinned positive rating actions for emerging market sovereigns.
It is not going to be like 1991 - when a caretaker Janata Dal Socialist government, headed by Prime Minister Chandra Sekhar, was facing bankruptcy and was on the verge of defaulting on its external balance of payment obligations.
The deficit for just three years a from 2009 to 2011 a towered to BGN 5 B and judging by the government's forecasts the country's external balance will show a shortfall for seven years in a row.
By Pratap John/Chief Business Reporter Standard & Poor's has maintained its "stable outlook" on Qatar on the strength of the country's "high levels of economic wealth and strong fiscal and external balance sheets".
Commenting on the recent developments on that front, Finansbank economist BaE-ak Karaaslan said a correction in the external balance seems to be continuing with declining CAD figures.

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