Balance of Payments: February 2018
20/04/2018 - Press Releases
Current account
In February 2018, the current account showed a deficit of €1.3 billion, up by €263 million year-on-year. Specifically, the deficit of the balance of goods shrank, which more than offset a decline in the surplus of the services balance, resulting in an improvement in the overall balance of goods and services. By contrast, the primary and the secondary income accounts deteriorated. The increased deficit of the primary income account, mainly due to higher net interest payments, was the main driver behind the widening of the current account deficit.
The drop in the deficit of the balance of goods is attributable to an improvement in the oil balance, as oil exports increased by 18.4% (18.9% at constant prices), while the corresponding imports fell. By contrast, the deficit of the non-oil balance of goods recorded a small increase, despite the fact that the relevant exports rose by 12.9% (11.8% at constant prices), i.e. faster than the growth rate of the corresponding imports (8.6% and 8.7% at current and constant prices, respectively).
The decrease in the services surplus is due to lower net travel and other services receipts, while net transport receipts increased mainly as a result of a 10.2% rise in net sea transport receipts. The travel balance showed a deficit, despite an 8.9% rise in arrivals, as the corresponding receipts grew less than travel spending by residents abroad.
In the January-February 2018 period, the current account balance showed a deficit of €1.9 billion, up by €509 million year-on-year. This development is primarily attributable to a rise in the deficit of the balance of goods, which resulted from increases in the deficits of both the oil balance and the non-oil balance of goods and, secondarily, from a deterioration in other individual balances.
Exports of goods increased by 16.9% (15.1% at constant prices), i.e. faster than the growth rate of imports (14% and 10% at current and constant prices, respectively). Nevertheless, the rise in imports in absolute terms was stronger than the rise in exports, which resulted in a higher deficit.
The decrease in the services surplus is due to a worsening in the travel balance, despite an increase in non-residents' arrivals and the corresponding receipts by 12.7% and 4.2% respectively, as well as to a deterioration in the other services balance. The transport balance remained broadly unchanged.
Lastly, a decline was registered in the surpluses of the primary and the secondary income accounts.
Capital account
In February 2018, the capital account surplus turned into a small deficit, compared with February 2017, as net transfers to general government were zero. In the January-February 2018 period, the capital account surplus fell by €73 million year-on-year.
Combined current and capital account
In February 2018, the combined current and capital account (corresponding to the economy’s external financing requirements) showed a deficit of €1.3 billion, up by €480 million year-on-year. In the January-February 2018 period, the combined current and capital account showed a deficit of €1.7 billion, up by €582 million year-on-year.
Financial account
In February 2018, under direct investment, residents' net external assets increased by €13 million and residents' net external liabilities, which represent non-residents' direct investment in Greece, rose by €234 million.
Under portfolio investment, a net increase in residents' external assets is mainly attributable to a rise of €460 million in residents' holdings of foreign bonds and Treasury bills. A net increase in their liabilities is mainly due to a rise of €3.2 billion in non-residents' holdings of Greek government bonds and Treasury bills.
Under other investment, a net decrease in residents' external assets is mainly attributable to a decline of €681 million in residents’ deposit and repo holdings abroad and to the statistical adjustment related to holdings of banknotes (1). A net decrease in liabilities reflects a fall of €1.6 billion in non-residents' deposit and repo holdings in Greece (the TARGET account included).
In the January-February 2018 period, under direct investment, residents' net external assets increased by €406 million and residents' net external liabilities, which represent non-residents' direct investment in Greece, rose by €405 million.
Under portfolio investment, a net decrease in residents' external assets is chiefly attributable to a decline of €2.1 billion in residents' holdings of foreign bonds and Treasury bills. A net increase in their liabilities is mainly due to a rise of €4.2 billion in non-residents' holdings of Greek government bonds and Treasury bills.
Under other investment, a net decrease in residents’ external assets mainly reflects the statistical adjustment related to holdings of euro banknotes (2). A net decline in liabilities reflects mainly a fall of €3.6 billion in non-residents' deposit and repo holdings in Greece (the TARGET account included).
At end-February 2018, Greece’s reserve assets stood at €6.6 billion, i.e. they showed no significant change compared with February 2017.
Note: Balance of payments data for March 2018 will be released on 21 May 2018.
(1) In February 2018, both assets and liabilities registered a decrease on account of the statistical adjustment related to holdings of euro banknotes, which came to €605 million and €578 million, respectively.
(2) In the January-February 2018 period, both assets and liabilities registered a decrease on account of the statistical adjustment related to holdings of euro banknotes, which came to €1.3 billion.
Related link: Balance of Payments: February 2018 - Table