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Answers to the big balance of payments Christmas quiz

Thank you for joining the big balance of payments Christmas quiz. Below you can view the answers.

Een vrouw die wandelt in een winkelcentrum rond de kerst

Question 1: Santa Claus, with all his cross-border gift-giving, may have a big impact on the balance of payments, but he does not set its rules. Which organisation is responsible for setting the rules for calculating the balance of payments?

  • a. Eurostat
  • b. The Bank for International Settlements
  • c. The United Nations
  • d. The International Monetary Fund

Answer d. The International Monetary Fund has set the guidelines in the Balance of Payments and International Investment Position Manual since 1947. The current, sixth edition of this manual dates from 2009, and is currently under review. The new edition will have a particular focus on properly measuring the effects of increasing globalisation and digitalisation, and on the topic of sustainability. It is expected to be released in 2025. The ever higher quality demands and the higher complexity of the balance of payments is visible in the number of pages of the manual. The first edition consisted of 57 pages, the sixth edition of 351 pages.

Question 2: Santa Claus works very hard to make sure Christmas is a time of joy, relaxation and reflection. Why do DNB staff also work hard in December to prepare the balance of payments?

  • a. If the balance of payments tips out of balance at the end of the year, then this can pose problems when setting budgets for the coming year.
  • b. Economists and policymakers need to have a reliable picture of transactions and financial relationships between the Netherlands and the rest of the world as soon as possible, with the underlying aim of identifying trends and vulnerabilities.
  • c. Distinguishing the impact of the December economy (Christmas and other holidays) from the “normal” economy in other months helps to avoid drawing misleading conclusions.
  • d. Having rapid access to the net asset position of the Netherlands contributes to the current debate on the distribution of wealth.

Answer b. The balance of payments is useful for several purposes, but the origin of the framework lies in properly documenting the transactions and financial relationships between a given country and the rest of the world. People began to acknowledge a need for better statistics on these aspects after the international stock market boom of the 1920s and the Great Depression that followed the crash in 1929. Economists and policymakers use the balance of payments for research and to formulate and assess policy measures.

Question 3: When Santa Claus arrives at the Dutch border, he has 10 million presents in his sleigh. When his work in the Netherlands is done, he moves on to Belgium with only 1 million presents left. How many presents do we register in the goods account in the Netherlands?

  • a. Nothing, because the presents are free.
  • b. Imports of 10 million and exports of 1 million, equal to the presents entering and leaving the Netherlands.
  • c. Imports of 9 million presents, the rest being in transit without transfer of beneficial ownership.
  • d. Almost nothing, as goods are only registered if they have a unit value of more than €1000 (presents containing game consoles do not count, while expensive fatbikes given as gifts do count).

Question 4: It is said that Santa Claus lives at the North Pole. In that case, which of the following answers is not reflected in the North Pole’s balance of payments

  • a. The costs charged by “North Pole Inc.” to Santa for the rental of the sleigh.
  • b. The costs incurred by Rudolph the injured reindeer (a resident of the North Pole) to have a broken leg put in a cast in the Netherlands after an unplanned altercation with a wolf in the countryside.
  • c. A present ordered by Santa from a Dutch online shop.
  • d. The extra Christmas cookies that Santa imports from Switzerland because the elves at the North Pole warehouse have eaten all the stock.

Answer a. This is a transaction between two North Pole entities and is therefore not reflected in the North Pole’s balance of payments.

Question 5: To streamline the money flows involved in the distribution of Christmas presents, Santa has set up a multinational network of companies. This network includes also a number of holding companies in the Netherlands. The headquarters of this multinational, “Xmas is all around us Inc.”, is located in the jurisdiction that has the largest international investment position in the Netherlands. Which jurisdiction is this?

  • a. The North Pole
  • b. The United States
  • c. Luxembourg
  • d. China

Answer b. The United States has the largest investment position in the Netherlands: €910 billion in 2022, which is higher than total Dutch GDP. Much of this involves investments that flow back abroad via the Netherlands. See Table 12.16 for the foreign direct investment position in the Netherlands.

Question 6: Partly due to Santa’s growing influence on the Dutch economy, we have a positive current account balance, also known as a surplus. Why is there a lot of international attention on the Netherlands’ current account surplus? The North Pole Central Bank, which reports a structural deficit, is particularly interested in this topic...


  • a. This means the Dutch economy is doing well. The higher the surplus, the better.
  • b. A structural surplus of a country’s balance of payments is an indication that the data collected are inaccurate, and there is an unjustly difference between the components, for example the current account and the financial account.
  • c. Especially when the net goods and services transactions have opposite signs, a surplus can point to a fast structural transformation of the economy.
  • d. A structural large current account surplus (of more than 6% of gross domestic product) or a large deficit may be an indicator of potential macroeconomic imbalances in the euro area.

Answer d. The Dutch current account surplus is a topic of interest as it is consistently above the 6% norm set by the European Commission as part of the Macroeconomic Imbalance Procedure (MIP). The MIP aims to identify potential macroeconomic imbalances in the euro area that could adversely affect the EU economy or the euro. The economy of the North Pole has a structural current account deficit because it imports the presents and chocolates abroad against market prices and thereafter gives it away for free abroad.''

Question 7: Santa Claus delivers millions of presents worldwide every year. At DNB, we also know how to deal with big numbers. Approximately how many data points does the Dutch balance of payments contain to illustrate relationships between the Netherlands and foreign countries in a given quarter?

  • a. 12,000 data points
  • b. 51,000 data points
  • c. 128,000 data points
  • d. 260,000 data points

Answer d. This refers to the number of unique data points. These, in turn, are aggregated to create specific cross-sections (e.g. countries aggregated to provide insight into the EU total).