Difference between BOT and current account of BOP in tabular form
|Balance f trade||BOP Current Account|
|Shows balance on account of export and import of visible items||Shows balance on account of export and import of visible items and invisible items and unilateral transfers from one country to other country.|
|BOT= Export of Visible Items – Import of Visible Items||CA= Balance of Visible Trade + Balance of Invisible Trade and Balance of Unilateral Trade|
This is a great table I would just add something more on Balance of trade and Balance of payment. Both BOT and BOP determine the nation’s GDP, along with other factors.
The governments take different actions to improve them. BOT can be improved by imposing higher import taxes to lessen the import of goods, where as BOP can be improved by encouraging the people to buy products that are manufactured in the country.
Gold has been always a bone of contention for every country. Some countries don’t stock Gold but use Equity as investment. If you import Gold then there is a cost attached to it in terms of import taxes. Gold of jwellery is ok but not as investment.
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