Balance of payments: September 2019
20/11/2019 - Press Releases
Current account
In September 2019, the current account showed a surplus of €887 million, up by €339 million year-on-year. This development is attributable to an improvement primarily in the services balance and secondarily in the balance of goods and the primary income account, which was partly offset by an increase in the deficit of the secondary income account.
The deficit of the balance of goods shrank by €82 million on account of a decrease in the deficit of the oil balance, which resulted exclusively from lower imports. Exports of goods excluding oil rose by 7.4% at current prices (8.3% at constant prices), while the corresponding imports increased by 6.2% at current prices (6.6 % at constant prices), resulting in the deterioration of the non-oil balance.
A rise of €299 million in the surplus of the services balance is exclusively attributable to higher net travel receipts, as the transport and the other services balances registered a deterioration. It should be noted that travel receipts increased by 16% and non-residents’ arrivals rose by 5% year-on-year.
The deficit of the primary income account decreased mainly on account of lower net interest, dividend and profit payments. Finally, the deficit of the secondary income account grew due to the deficit recorded in the balance of the other (excluding general government) sectors, as against a surplus in September 2018.
In the January-September 2019 period, the current account was almost balanced, while a €1.4 billion deficit was recorded in the same period of 2018. This development reflects mainly a rise in the services surplus and also an improvement in the primary and the secondary income accounts, which more than offset an increase in the deficit of the balance of goods.
A rise in the deficit of the balance of goods is due to the fact that imports increased more than exports in absolute terms. It should be noted that both exports and imports of goods have decelerated significantly year-on-year, chiefly on account of developments in the oil sector. However, non-oil exports registered a 4.6% increase at current prices (5.0% at constant prices) and the corresponding imports rose by 5.3% at current prices (5.2% at constant prices).
A rise in the surplus of the services balance is due to an improvement primarily in the travel balance and secondarily in the transport and other services balance. Travel receipts and non-residents’ arrivals increased by 14% and 3.8% year-on-year respectively. In addition, transport (mainly sea transport) receipts rose by 5.5%.
Capital account
In September 2019, the deficit of the capital account declined and stood at €48 million, while in the January-September 2019 period, the surplus of the capital account grew by €48 million year-on-year.
Combined current and capital account
In September 2019, the combined current and capital account (corresponding to the economy’s external financing requirements) showed a surplus of €839 million, up by €408 million year-on-year. In the January-September 2019 period, the combined current and capital account recorded a surplus of €190 million, against a deficit of €1.2 billion in the same period of 2018.
Financial account
In September 2019, under direct investment, residents’ net external assets registered an increase of €132 million, while residents’ net external liabilities (stemming from non-residents’ direct investment in Greece) registered a rise of €101 million, without any remarkable transactions.
Under portfolio investment, a net increase in residents’ external assets is attributable to a rise of €23 billion in their holdings of foreign bonds and Treasury bills (loan securitisation). A net decrease in their liabilities is almost entirely attributable to a drop of €340 million in non-residents’ holdings of Greek government bonds and Treasury bills.
Under other investment, a net decrease in residents’ external assets is attributable to a decline of €1.6 billion in residents’ deposit and repo holdings abroad and the statistical adjustment (of €1.2 billion) related to holdings of euro banknotes. A net increase in their liabilities reflects a rise of €22.2 billion in non-residents’ deposit and repo holdings in Greece (including the TARGET account, as well as loan securitisation).
In the January-September 2019 period, under direct investment, residents’ net external assets increased by €273 million and their net external liabilities rose by €2.6 billion.
Under portfolio investment, a net increase in residents’ external assets is due to a rise of €24.5 billion in residents’ holdings of foreign bonds and Treasury bills. A net increase in their liabilities is accounted for by a rise of €4.0 billion in non-residents’ holdings of Greek government bonds and Treasury bills.
Under other investment, a net increase in residents’ external assets is chiefly attributable to the statistical adjustment (of €3.9 billion) related to holdings of euro banknotes, which was partially offset by a decrease of €3.5 billion in residents’ deposit and repo holdings abroad. A net increase in their liabilities reflects mainly a rise of €20.7 billion in non-residents’ deposit and repo holdings in Greece (the TARGET account included).
At end-September 2019, Greece’s reserve assets stood at €7.5 billion, compared with €6.2 billion at end-September 2018.
Note: Balance of payments statistics for October 2019 will be released on 20 December 2019.