1. Construct the balance of payment table for Japan for the year of 1998 which is comparable in format to Exhibit 3.1, and interpret the numerical data. A summary of the Japanese Balance of Payments for 1998 (in $ billion) Credits Debits Current Account (1) Exports -------- (1.1) Merchandise 374.04 (1.2) Services 62.41 (1.3) Factor income 209.58 (2) Imports -516.50 (2.1) Merchandise ---------- (2.2) Services -111.83 (3.3) Factor income -153.01 (3) Unilateral transfer 5.53 -14.37 Balance on current account ---------- ---------- [(1) + (2) + (3)] Capital Account (4) Direct investment 3.27 -24.62 (5) Portfolio investment 73.70 ---------- (5.1) Equity securities -------- -14.00 (5.2) Debt securities 57.59 -99.73 (6) Other investment 39.51 -109.35 Balance on financial account ------------- ---------- [(4) + (5) + (6)] (7) Statistical discrepancies 4.36 Overall balance ------------ Official Reserve Account ------------ -------------

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