Framework for Sustainability of the Current Account

Next we divide all variables by GDP measured in terms of US Dollars. We define non-interest non-energy current account-to-GDP ratio as current account balance-to-GDP ratio plus interest payments on foreign debt-to-GDP ratio plus energy imports-to-GDP ratio.
The balance of payments relation can be reduced to a difference equation determining the time path of foreign debt-to-GDP ratio.

Next we divide all variables by GDP measured in terms of US Dollars. We define non-interest non-energy current account-to-GDP ratio as current account balance-to-GDP ratio plus interest payments on foreign debt-to-GDP ratio plus energy imports-to-GDP ratio.