
                         Roanoke Times
                 Copyright (c) 1995, Landmark Communications, Inc.

DATE: TUESDAY, July 3, 1990                   TAG: 9007030073
SECTION: NATIONAL/INTERNATIONAL                    PAGE: A10   EDITION: METRO 
SOURCE: Associated Press
DATELINE: WASHINGTON                                LENGTH: Short

FOREIGN ASSETS IN U.S. RAISE NATION'S NET DEBT

The United States tightened its grip on the title of world's largest debtor nation in 1989, ending the year with a net debt of $663.7 billion, up a sharp 25 percent from the previous year.

The latest figures, based on data collected by the Commerce Department, are certain to heighten the emotional debate over whether the United States is losing control of its financial destiny to foreigners.

The Commerce Department report showed that U.S. holdings of overseas assets rose by $146.9 billion last year to $1.412 trillion, a gain of 11.6 percent.

But foreign holdings in the United States climbed at an even faster pace of 15.6 percent, rising by $279.6 billion to $2.076 trillion.

The $663.7 billion imbalance between what Americans own overseas and what foreigners own in the United States is the country's net debtor position. Many private economists believe it will top $1 trillion within a few years.

As recently as 1983, the United States was still the world's largest creditor nation, a position now held by Japan. The 1983 surplus of $89 billion fell to $3.3 billion in 1984 and disappeared altogether in 1985.

The surplus was eroded by America's huge merchandise trade deficits as Americans transferred billions of dollars into foreign hands to pay for imported cars and television sets.

by CNB