sectoral-balances

# Sectoral Balances & External Sector (Iceland) **Requires:** Tier 0 (core). Analytical skill for computing sectoral financial balances in the Godley/MMT accounting sense: ``` Private sector surplus = Government deficit + Current account surplus ``` …and related external-sector analysis: current account decomposition, NIIP attribution, pension-fund foreign asset holdings, who-owes-whom. ## When to use - "Is the current account deficit driven by goods or services?" - "How much of Iceland's positive NIIP comes from pension funds?" - "Government surplus / deficit as % of GDP" - "Private sector saving vs investment vs external balance" - "Attribute Iceland's foreign asset position by holder sector" ## Primary data sources All core series are on Hagstofan's PX-Web API (`https://px.hagstofa.is/pxis/api/v1/is/`). Seðlabanki's SDMX (`fr.sedlabanki.is`) has the authoritative quarterly BoP and IIP, but the endpoint is often unreachable from outside Iceland — fall back to Hagstofan + FSR PDFs. | Purpose | Source | Table | Period | Freq | |---|---|---|---|---| | Current account (full decomposition) | Hagstofan | `THJ01102` | 1995–2025 | annual | | Goods & services bridge to BoP basis | Hagstofan | `UTA05002` | 1995Q1–2025Q4 | quarterly | | Goods & services bridge (monthly) | Hagstofan | `UTA05000` | 2018m1–2025m12 | monthly | | Services trade detail | Hagstofan | `UTA04005`–`UTA04010` | 2009/2013–2024 | Q/annual | | Financial accounts by sector (stocks) | Hagstofan | `THJ10001` | 2003–2024 | annual | | Financial accounts as % of GDP | Hagstofan | `THJ10002` | 2003–2024 | annual | | Government headline fiscal balance | Hagstofan | `THJ05111` | 1980–2025 | annual | | Government revenue/expenditure/flow | Hagstofan | `THJ05123` | 1980–2025 | annual | | Government fiscal, quarterly | Hagstofan | `fjarmal_arsfj/*` | — | quarterly | | Government assets & debt | Hagstofan | `THJ05181` | 1998–2025 | annual | | NIIP breakdown by instrument & sector | Seðlabanki FSR PDF | — | annual | — | | Pension fund foreign asset share | Seðlabanki FSR PDF | — | annual | — | ## Table cheat-sheets ### `THJ01102` — Current account from SNA Rows use zero-based API codes, **not the numbered labels**. Verified September 2026: | API code | Label | Meaning | |---|---|---| | `11` | 8. Verg landsframleiðsla | Nominal GDP | | `18` | 11. Viðskiptajöfnuður án rekstrarframlaga | CA excluding secondary transfers | | `19` | 11.1 Vöruskiptajöfnuður fob/fob | Goods balance | | `20` | 11.2 Þjónustujöfnuður | Services balance | | `21` | 11.3 Launa- og eignatekjur frá útlöndum, nettó | Primary income | | `24` | 14. Rekstrarframlög, nettó frá útlöndum | Secondary income | Full current account = codes `18 + 24` (or `19 + 20 + 21 + 24`). **Unit:** millions ISK, nominal. Fetch metadata to resolve other rows; label numbers are not API codes. ### `UTA05002` — BoP bridge table, quarterly 35 line items, reconciles customs-basis goods/services data with BoP-basis. Key rows: | Code | Meaning | |---|---| | `21` | Vöruskiptajöfnuður í greiðslujöfnuði (goods balance, BoP basis) | | `31` | Þjónustujöfnuður (services balance) | | `32` | Vöru- og þjónustuviðskipti, útflutningur alls | | `33` | Vöru- og þjónustuviðskipti, innflutningur alls | | `34` | Vöru- og þjónustujöfnuður í greiðslujöfnuði | Use this for quarterly time series; use `THJ01102` for full-CA annual decomposition. ### `THJ10001` — Financial accounts (sectoral) Three dimensions: - **`Efnahagsgeirar`** — sector code (S0=all, S1=resident, S11=non-financial corps, S12=financial corps, S13=government, S14=households, **S129=pension funds**, **S2=rest of world**, …) - **`Fjármálagerningar`** — instrument (FA0=total assets, FL0=total liabilities, BF90=net = FA0 − FL0, and the FA1–FA8 / FL1–FL8 sub-instruments) - **`Mælikvarði`** — `Stocks 31/12` (year-end position), `Transactions`, `Revaluation`, `Other volume changes` **Reading the external position from this table:** - `S2 Útlönd` × `BF90` × `Stocks 31/12` = rest-of-world's net position against Iceland - Iceland's NIIP = −BF90(S2). A **negative** S2 BF90 means Iceland is a **net foreign creditor**. - `S129 Lífeyrissjóðir` × `FA0` × `Stocks 31/12` = pension fund total financial assets - This table does **not** provide a direct "pension fund foreign assets" breakdown — for that, see Seðlabanki FSR. ### Government sector — `THJ05111` Contains headline numbers: revenue, expenditure, primary balance, overall balance, gross debt, net debt — for general government, central government, local government. Use this for the fiscal side of the sectoral balances identity. ## Example queries ### Full annual current account decomposition ```bash curl -s -X POST \ "https://px.hagstofa.is/pxis/api/v1/is/Efnahagur/thjodhagsreikningar/landsframl/1_landsframleidsla/THJ01102.px" \ -H "Content-Type: application/json" \ -d '{ "query": [ {"code": "Skipting", "selection": {"filter": "item", "values": ["11","18","19","20","21","24"]}} ], "response": {"format": "csv"} }' -o current_account_annual.csv ``` ### Quarterly goods & services BoP bridge (last 10 years) ```bash curl -s -X POST \ "https://px.hagstofa.is/pxis/api/v1/is/Efnahagur/utanrikisverslun/3_voruthjonusta/voruthjonusta/UTA05002.px" \ -H "Content-Type: application/json" \ -d '{ "query": [ {"code": "Skipting", "selection": {"filter": "item", "values": ["21","31","32","33","34"]}} ], "response": {"format": "csv"} }' -o bop_bridge_qtr.csv ``` ### Financial accounts — pension funds, rest of world, all-sectors totals ```bash curl -s -X POST \ "https://px.hagstofa.is/pxis/api/v1/is/Efnahagur/thjodhagsreikningar/fjarmalareikningar/fjarmalareikningar/THJ10001.px" \ -H "Content-Type: application/json" \ -d '{ "query": [ {"code": "Efnahagsgeirar", "selection": {"filter": "item", "values": ["S0","S129","S2"]}}, {"code": "Fjármálagerningar", "selection": {"filter": "item", "values": ["FA0","FL0","BF90"]}}, {"code": "Mælikvarði", "selection": {"filter": "item", "values": ["Stocks 31/12"]}} ], "response": {"format": "csv"} }' -o financial_accounts_stocks.csv ``` ### Government headline fiscal balance ```bash curl -s -X POST \ "https://px.hagstofa.is/pxis/api/v1/is/Efnahagur/fjaropinber/fjarmal_opinber/fjarmal_opinber/THJ05111.px" \ -H "Content-Type: application/json" \ -d '{"query": [], "response": {"format": "csv"}}' -o government_headline.csv ``` ## Computing sectoral financial balances With consistent net-lending definitions: domestic non-government + general government + rest of world = 0. A surplus is positive. The familiar simplified identity is private surplus = government **deficit** + current-account surplus (not minus government deficit). Capital-account items and statistical discrepancies must be reconciled before substituting the current account for external net lending. For a directly reported financial-account measure, use `THJ10001` with `Mælikvarði=Transactions`: FA0 minus FL0 for each sector. Combine S11 + S12 + S14 + S15 as domestic non-government; S13 is general government and S2 is rest of world. This includes financial corporations (including S121, the central bank, per national accounts sectoring); do not call it households alone. Never use balance-sheet stocks or stock differences as net lending. Divide by nominal GDP, `THJ01102` code `11`, for the matching year. Keep financial-account balances distinct from nonfinancial-account net lending and the current account: discrepancies between these measures can be material. Financial accounts currently run through 2024; national accounts through 2025 (checked September 2026). ## NIIP attribution (the pension fund story) Seðlabanki's *Fjármálastöðugleiki* (FSR) publishes the authoritative NIIP and pension fund foreign-asset breakdown. As of FSR 2026/1 (end-2025): - **NIIP:** +44% of GDP ("Erlendar fjáreignir innlendra aðila umfram skuldir þeirra við erlenda aðila námu um 44% af vergri landsframleiðslu í lok árs 2025") - **Pension fund total assets:** 8,878 bn ISK = 179% of GDP - **Pension fund foreign assets:** 42% of total = ~70% of GDP - **Seðlabanki's own attribution:** *"Jákvæða erlenda stöðu má fyrst og fremst rekja til erlendra eigna lífeyrissjóða"* — i.e. pension fund foreign holdings exceed Iceland's entire NIIP; the rest of the economy is a net foreign debtor. FSR PDFs are already extracted to `data/processed/fsr_narrative/` (via docling). Grep there for `lífeyris|erlend` when you need the latest figures: ```bash rg -n "lífeyris|erlend|NIIP|erlend staða" data/processed/fsr_narrative/fsr_2026_1_docling.md ``` Seðlabanki also publishes a standalone *Greiðslujöfnuður, ytri staða og áhættuþættir* report (October each year) with the full NIIP decomposition by instrument, sector and currency. ## Caveats 1. **Flows vs stocks confusion.** The current account is a *flow* (annual). The NIIP is a *stock* (cumulative). A small CA deficit (a flow) is entirely consistent with a large positive NIIP (a stock accumulated over decades) — especially when pension fund foreign holdings swamp the annual flow. Don't attribute CA deficits to pension funds "diversifying abroad" — that's a capital outflow, which is associated with a CA *surplus*, not a deficit. 2. **Sign convention on S2 Útlönd.** `BF90` for `S2` is the *rest-of-world's* net position *against Iceland*. A negative value means rest-of-world owes Iceland more than it owns in Iceland → Iceland is a net creditor. Flip the sign when reporting Iceland's NIIP. 3. **FA0 – FL0 on S129 is ~0 by construction.** Pension funds' liabilities are accrued pension entitlements to their members, which roughly match their assets. The interesting question is not their net position but the *asset-side composition* (domestic vs foreign) — that's in Seðlabanki, not Hagstofan. 4. **`Launa- og eignatekjur` is primary income on the CA.** High ISK policy rates make foreign investors earn a lot on ISK holdings, which pushes net primary income *negative* even when Iceland is a net foreign creditor. This is counterintuitive but correct: stocks and flows tell different stories. 5. **Secondary income is small but nonzero** (~−1% of GDP, mostly EU contributions and remittances) — remember to add it for the full CA. 6. **Seðlabanki SDMX is often unreachable.** The `fr.sedlabanki.is` endpoint times out from many networks. Prefer Hagstofan PX-Web + FSR PDF extraction. ## Key reference facts (end-2024 / end-2025) Burn these in for quick sanity checks during analysis: - Nominal GDP: ≈ 4,578 bn ISK (2024), ≈ 4,956 bn ISK (2025) - Goods balance: ~−323 bn (2024, −7.1% GDP) / ~−385 bn (2025, −7.8%) - Services balance: ~+265 bn (2024, +5.8% GDP) / ~+273 bn (2025, +5.5%) - Current account (incl transfers): ~−149 bn (2024, −3.2% GDP) / ~−178 bn (2025, −3.6%) - NIIP: +44% of GDP (end-2025, FSR 2026/1) - Pension fund total assets: 8,878 bn ISK = 179% GDP - Pension fund foreign assets: 42% of portfolio ≈ 70% of GDP