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According to the fundamentals of Balance of Payments (BOP), the sum of its sub accounts must always add up to zero. Usually for most economies,

According to the fundamentals of Balance of Payments (BOP), the sum of its sub accounts must always add up to zero. Usually for most economies, a deficit in the current account is offset by a surplus in the financial/capital account, or vice versa. However, China has been running a huge surplus in both of its current account and financial/capital account in the last 15 years.


How is this possible? Does that mean the BOP is in surplus for China? Explain in detail.

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