华南理工大学 （South China university of Technology Guangzhou Guangdong） 摘要：净误差和遗漏项目明显的变动可能暗示不寻常的资金流出或流入中国。虽然净误差和遗漏项目的启示作用不一定可靠，但它可以作为观测资金运动和确认资金流向的途径之一。
关键词：净误差和遗漏相热钱运动国际结算收支平衡表
A.the analysis of Net errors and omissions account in BOP ofChina
As the balance of payments is recorded in a double entry system of credits and debits，it requires each credit has a corresponding debit and both are recorded in equal amount.
However，owing to different statistical methods and various accesses to data，errors and omissions are unavoidable，which may lead to imbalance of the BOP，the balance of payment.Therefore net errors and omissions account is set to offset the cumulated net difference in the other accounts.
What lead to errors and omissions in BOP in china？ The gathering data are collected from multiple government sectors using different statistical methods and principle.So the statistical errors and omissions have occurred in the whole process.Besides，some transactions are difficult to record comprehensively and cause omissions.For example，when a foreign friend gives amount of carry-on cash to a domestic resident，such a amount of money could be reflected only on the increase of domestic deposit account of that domestic resident，and the source of the money cannot be identified，which may give rise to omissions of the information.As a result，this amount of money could be reflected as a part of net errors and omission in the BOP.The last possible explanation is that the liability and accuracy of the statistical data have to be discounted to some degree.For example certain enterprises provide information such as non-capital stock volume and flow volume to cheat government for tax free privilege.
Based on the above information，if the dominant cause of net errors and omissions is ascribed to statistical difficulties，differences of the BOP should be distributed randomly in both the credits and the debits.However，if differences always remain in the debits，an unrecorded outflow of money may have existed. Conversely，an influx of hot money is indicated.
Look at the following diagram，and the data are come from State Administration of Foreign Exchange.
The Asian financial crisis broke up in 1997.Although RMB is still strong，investors lose confidence in Asian market that lead to an outflow of money from Asia includingChina.This accounts for why a large number in debit in net errors and omissions account was appeared in 1997.
While since 2001，the record of net errors and omissions account changed from the debits to the credits.Thanks to China"s entry to the WTO and its economical stability，a large number of foreign funds entered the country to seek for profits.In addition，since 2002，with a general expectation of RMB"s appreciation，hot money motivated by arbitrage opportunities on Foreign exchange surged into China as the increasing number of net errors and omission in credit from 2002 to 2004 indicated.
B.The example: the movements of hot money in 2008
The year 2008，when the financial crisis broke out globally，is a typical year to analyze the movements of the hot money.From the big decrease in the net errors and omissions from 17133 million dollars in the first half of year to 2090 million dollars in credit at the end of year，we could estimate the direction of the hot money is changing.
What is the hot money？ Money that flows between financial markets in search of the highest short term interests does not go into manufacturing but instead it goes to trade and speculation，such as stock markets，real estate markets.
a.China risks scorching as hot money flows in 2008 first half
One common way to estimate the amount of “hot money” is to subtract a nation"s trade surplus （or deficit） and its net flow of foreign direct investment （FDI） from the newly added the nation"s foreign reserves.
At the end of first half of 2008,China"s foreign reserves increased by $280.6 billion.Over the same time period，China"s accumulated trade surplus was $129.2billion and its FDI inflow was $74.1 billion.Using the method described above: China received an inflow of $77.3（280.6-129.2-74.177.3） billion in “hot money” during the first half of 2008.Some western analysts think the Chinese figures underestimate the amount of “hot money” in China because they do not take into account changes in China"s monetary policies，such as the raising of reserve requirements and the creation of China"s sovereign wealth fund，the China Investment Corporation.Taking into account these other factors，some U.S.financial analysts estimates that China received over $400 billion in “hot money” flows between April 2007 and March 2008（you can observe the corresponding records in credit in the net errors and omissions account from year 2007 to 2008 the first half）.
There are three main causes of china"s inflow of hot money.First Over the last year，interest rates inChina and the United States have been moving in opposite directions.The U.S.Federal Reserve lowered the federal funds rate nine times over the last year from a high of 5.25% in June 2007 to its current low of 2.00%.Over the same time period，the People"s Bank of China raised its benchmark one-year interest rate on deposits from 2.52% to 4.14%.The reversal in the relative interest rates of the two nations has created an incentive for investors to move their deposits from the United States to China in order to earn a higher rate of return.In addition to the attraction of the interest rate difference，speculators are moving “hot money” into China because of the general expectation that the RMB will continue appreciate in value against the U.S.dollar and other currencies.On July 21，2005，China announced it gave up its fixed exchange rate policy for a “managed float” policy that would allow the value of the RMB to fluctuate within a specified range on a daily basis.Since then，through July 15，2008，the RMB has appreciated in value by 21.6%.Most analysts expect the Chinese government to continue the RMB"s appreciation.
The great number of the hot money flowing inChina pushed the price of China to increase outrageously，such as the price of real estate.
b.Huge Capital Outflow Likely in 2008 Second Half
In 2008，the estimated number of hot money outflow isChina"s foreign reserves increased by 4748$billion.Over the same time period，China"s accumulated trade surplus was 3489billion and its FDI inflow was 1751billion.Using the method described above: the outflow from China in the second half of 2008 might be $457（4748-3489-1751457） billions.Although simply equaling figures in the debit as an outflow of the hot money is not correct，as the thumb of the rule says that the net errors and omissions account takes up 5% of the total import and export volume is acceptable，the decrease figure in credit of the net errors and omissions account in 2008 and the following figures of the net errors and omissions account in debit from 2009 to 2010，this trend，could indicate an outflow of the hot money from China，or fewer hot money flows in China.
The main reasons for sudden money outflow could be，first，as the financial crisis broke out，the global funds become insufficient and short.Owing to big losses in the speculation of financial derivatives，many foreign companies drew out of a large number of money fromChina.Secondly，the government of China has taken serious measures to take down the inflow of hot money as to control the price of real estate market as well as other speculative markets in China.However，what is worth more attention is that the deficit worsened in 2009.As is happening in many emerging markets，capital outflow during the financial crisis will put heavy pressure on China"s asset prices and RMB rate.
References：
1.Liuguo and Huyashan，2008，International Finance，University of international business and economics Press
2.Lanxinzhen，2010，Fending off the hot money,Beijing Review
3.Chenbowen，“hot money”: the path of planning beforehand in emerging economies，Financial Management and Research
4.All the data are come from State Administration of Foreign Exchange
（责任编辑：陈 通）