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Balance of Payments: February 2021

20/04/2021 - Press Releases

Current account 

 

In February 2021, the current account showed a deficit of €840 million, improving by €314 million year-on-year. This development is attributable to an improvement in the balance of goods and the primary income account, which was partly offset by a deterioration in the services balance and the secondary income account.

A drop in the deficit of the balance of goods is accounted for by an increase in the value of exports by 9.5% and a decrease in the value of imports by 5.1%, which were mainly due to changes in the value of oil exports and imports. At constant prices, exports rose by 11% and imports fell by 10.7%. In addition, non-oil exports of goods grew by 2.4% and the corresponding imports fell by 1.1% at constant prices.

A decline in the services surplus is attributable to a year-on-year deterioration in all its main components. Non-residents' arrivals and the corresponding receipts fell by 87.8% and 89.4%, respectively. The surplus of the transport balance dropped by 17.8%, mainly on account of a 7.5% decrease in net sea transport receipts. 

In February 2021, the surplus of the primary income account more than doubled, mainly on account of lower net interest, dividend and profit payments. The secondary income account recorded a deficit, against a surplus in the same month of 2020, chiefly as a result of higher general government payments.

In the January-February 2021 period, the current account showed a deficit of €1.3 billion, down by €1.2 billion year-on-year. This development is attributable to a decrease in the deficit of the balance of goods, as well as an improvement in the primary and the secondary income accounts, which were partly offset by a decrease in the services surplus.

The lower deficit of the balance of goods is accounted for by a larger decline in imports than in exports. Specifically, exports fell by 2.4% at current prices and imports decreased by 11.2%. It should be noted that exports of goods at constant prices grew by 3.6%.

A decrease in the services surplus is attributable to a deterioration in the travel balance and the transport balance, while the other services balance improved. Non-residents’ arrivals and the relevant receipts fell by 87.9% and 90.3%, respectively, year-on-year. Transport receipts fell by 17.1%. Lastly, the surpluses of the primary and the secondary income accounts improved considerably.

 

Capital account

 

In February 2021, the capital account registered a deficit of €3.2 million, against a surplus of €107 million year-on-year. In the January-February 2021 period, the capital account surplus improved year-on-year and stood at €480 million, owing to a rise in EU capital transfers to general government.

 

Combined current and capital account

 

In February 2021, the deficit of the combined current and capital account (corresponding to the economy’s external financing requirements) fell to €844 million, from €1.0 billion in February 2020. In the January-February 2021 period, the combined current and capital account recorded a deficit of €796 million, compared with €2.3 billion in the same period of 2020.

 

Financial account

 

In February 2021, under direct investment, residents' external assets registered a small increase of €21 million. Residents’ external liabilities grew by €259 million.

Under portfolio investment, an increase in residents’ external assets is mainly due to a rise of €2.0 billion in residents’ holdings of foreign bonds and Treasury bills. An increase in their liabilities is almost exclusively due to a rise of €2.3 billion in non-residents’ holdings of Greek government bonds and Treasury bills.

Under other investment, a drop in residents’ external assets is due to a decrease of €757 million in residents’ deposit and repo holdings abroad, which was partly offset by an increase of €362 million in loans extended to non-residents. A small decline in residents’ liabilities reflects on the one hand a drop of €1.3 billion in non-residents’ deposit and repo holdings in Greece (the TARGET account included) and, on the other hand, a €1.1 billion rise in the outstanding debt to non-residents.

In the January-February 2021 period, under direct investment, residents’ external assets rose by €45 million and residents’ external liabilities, which represent non-residents’ direct investment in Greece, increased by €585 million.

Under portfolio investment, a net rise in residents’ external assets is mainly due to an increase of €4.5 billion in residents’ holdings of foreign bonds and Treasury bills. A net increase in their liabilities is due to a rise of €1.4 billion in non-residents’ holdings of Greek government bonds and Treasury bills.

Under other investment, higher residents’ external assets mainly reflect an increase of €498 million in loans extended to non-residents and the €166 million statistical adjustment related to the issuance of euro banknotes, which was partly offset by a €637 million decrease in residents’ deposit and repos holdings abroad. A rise in residents’ liabilities reflects chiefly an increase of €2.8 billion in non-residents’ deposit and repo holdings in Greece (the TARGET account included), as well as a €632 million rise in the outstanding debt to non-residents.

At end-February 2021, Greece’s reserve assets stood at €9.2 billion, compared with €7.8 billion at end-February 2020.

 

Note: Balance of payments data for March 2021 will be released on 21 May 2021.

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