Balance of payments: JANUARY 2007
21/03/2007 - Press Releases
Current account balance
In January 2007, the current account balance showed a
deficit of €2,804 million, i.e. €582 million higher than in January 2006. This
development reflects the widening mainly of the trade deficit and secondarily of
the income account deficit, which was not offset by a small increase in the
surpluses of the services balance and the current transfers balance.
The €553 million rise in the trade deficit mainly reflects
increases of €310 million and €209 million in net payments for purchases of
ships and in the trade deficit excluding oil and ships, respectively, while the
net oil import bill grew by only €34 million. It should be pointed out that
exports of goods excluding oil and ships continued to rise markedly (by €122
million or 14.0%), but the corresponding imports also grew at the same time (by
€331 million or 12.3%). The €40 million hike in the surplus of the services
balance is attributable mainly to a decline in the deficit of the travel
services balance (it should be pointed out that in January residents' travel
spending abroad outstripped non-residents' spending in Greece) and, secondarily,
to a rise in the surplus of the transportation services balance. The widening of
the income account deficit mainly reflects higher net interest payments on
deposits and loans and, secondarily, increased interest payments on Greek
government bonds held by non-residents. Finally, the growth of the current
transfers surplus is accounted for by higher net current transfers from the EU
to general government. It should be recalled that current transfers from the EU
mainly include receipts from the Guarantee Section of the European Agricultural
Guidance and Guarantee Fund (EAGGF) in the context of the Common Agricultural
Policy, as well as receipts from the European Social Fund, while current
transfers to the EU include Greece's contributions (payments) to the Community
Budget.
Capital transfers balance
In January 2007, the capital transfers balance showed
a surplus of €74 million, i.e. it doubled year-on-year. Capital transfers mainly
include receipts from the Structural Funds – except for the European Social Fund
– and the Cohesion Fund under the Community Support Framework.
Combined current account and capital transfers balance
(according to the old method of presentation)
The combined current account and capital transfers balance
showed a deficit of €2,730 million in January 2007, compared with €2,186
million in January 2006.
Financial account balance
In January 2007, there were no substantial flows
recorded under direct investment. In particular, under non-residents' investment
in Greece, the most important inflow (€22 million) concerned the acquisition of
the diagnostic branch of BAYER HELLAS by SIEMENS (Germany). Residents'
investment abroad came to €95 million: the most important outflow (€17 million)
concerned the acquisition of the company TECHNO ACCION (Argentine) by INTRALOT.
Under portfolio investment, a net inflow of €4,192 million was recorded, mainly
reflecting non-residents' purchases of Greek government bonds and shares of
Greek firms (of €2,912 million and €1,561 million respectively) and declines (of
€322 million and €293 million) in residents' holdings of foreign shares and
Treasury bills, respectively. These developments were partly offset by increases
(of €631 million and €176 million) in residents' holdings of foreign bonds and
financial derivatives, respectively. ''Other'' investment recorded a small net
outflow of €1,912 million, mainly because the rise in Greek credit institutions’
and institutional investors’ deposit and repo holdings abroad was only partly
offset by an increase in foreign credit institutions' corresponding investment
in Greece.
At end - January 2007, Greece's reserve assets reached
€2.0 billion. It should be recalled that, since Greece joined the euro area in
January 2001, reserve assets, as defined by the European Central Bank, include
only monetary gold, the ''reserve position'' with the IMF, ''Special Drawing
Rights'', and Bank of Greece claims in foreign currency on residents of non -
euro area countries. Conversely, reserve assets do not include claims in euro on
residents of non-euro area countries, claims in foreign currency and in euro on
residents of euro area countries, and the Bank of Greece participation in the
capital and the reserve assets of the ECB.
Note: Balance of payments data for February 2007 will
be released on 20 April 2007.