Balance of payments: FEBRUARY 2008
21/04/2008 - Press Releases
Current account balance
In February 2008, the current account deficit narrowed
by €1,317 million year-on-year, to reach €1,843 million, reflecting a
considerable surplus in the current transfers balance, as well as an increase in
the surplus of the services balance. These developments more than offset a
widening mainly of the trade deficit and, secondarily, of the income account
The year-on-year increase of €707 million in the overall
trade deficit is attributable to increases of €346 million, €186 million and
€175 million in the trade deficit excluding oil and ships, the net oil import
bill and net payments for purchases of ships, respectively.
The surplus of the services balance widened by €150 million,
as a result of an increase in net transport receipts (up €258 million), which
more than offset the rises in both net travel payments and net payments for
other services (up €27 million and €81 million respectively).
The €81 million rise in the income account deficit is
mainly attributable to higher net interest, dividend and profit payments.
The current transfers balance showed a considerable surplus
of €1,667 million (compared with a deficit of €289 million in February
2007), as EU transfers to general government increased, while general government
payments to the EU declined. (It should be noted that gross 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
In January-February 2008, the current account deficit
dropped by €1,090 million over the same period in 2007 and reached €4,839
million, mainly reflecting the significant increase in the surplus of the
current transfers balance and in the surplus of the services balance, which more
than offset a rise in the trade deficit and a small increase in the income
The €902 million hike in the overall trade deficit was
mainly a result of increases (of €748 million and €283 million) in the trade
deficit excluding oil and ships and in the net oil import bill, respectively. By
contrast, net payments for purchases of ships dropped by €129 million. With
respect to the trade balance excluding oil and ships, export receipts grew by
€354 million or 19.5%, while the corresponding import bill rose by €1,103
million or 19.0%.
The services surplus expanded by €703 million, reflecting
higher net transport receipts. The travel services balance remained almost
unchanged, while net payments for other services grew. It should be noted that
gross transport receipts (mainly from merchant shipping) increased by 45% and
gross travel receipts by 14.6%.
The income account deficit rose by €92 million, as a result
of higher net interest, dividend and profit payments. This development is mainly
associated with a rise in non-residents ' holdings of public debt.
Finally, the €1,381 increase in the surplus of the current
transfers balance is attributable to both a rise in EU transfers to general
government and a decline in general government payments to the EU.
Capital transfers balance
In February 2008, the capital transfers balance showed
a surplus of €887 million, compared with €767 million in February 2007. (Capital
transfers from the EU mainly include receipts from the Structural Funds - except
for the European Social Fund - and the Cohesion Fund, under the Community
In January-February 2008, the capital transfers
balance showed a surplus of €1,341 million, i.e. considerably higher (by €500
million) than in the same period of 2007. This reflects a rise in EU capital
transfers to general government. Thus, the overall transfers balance (current
transfers plus capital transfers) recorded a surplus of €2,867 million,
compared with €986 million in 2007.
Combined current account and capital transfers balance
(according to the old method of presentation)
The combined current account and capital transfers balance (according
to the old method of presentation) showed a deficit of €956 million in
February 2008, compared with a deficit of €2,394 million in the same month of
2007. In January-February 2008, this deficit came to €3,498 million, compared
with €5,088 million in the same period of 2007.
Financial account balance
In February 2008, residents' direct investment abroad
came to €181 million. This investment mainly concerned an outflow of €26
million by PIRAEUS BANK for increasing its participation in the share capital of
its subsidiary ATLAS BANK (Serbia), as well as a €17 million outflow for the
increase in EUROBANK's participation in the share capital of its subsidiary
EUROBANK SERBIA (Serbia). Non-residents' investment in Greece came to €63
million. The most important investment concerned an inflow of €50 million for
the participation of the ALAPIS FARMA (Cyprus) in the capital of its parent
company ALAPIS SA. Under portfolio investment, a net inflow of €4,234 million
was recorded, almost exclusively attributable to the fact that non-residents '
purchases of Greek government bonds (of €7 billion) more than offset residents'
purchases of foreign bonds (of €2.7 billion). "Other" investment
recorded a net outflow of €3,361 million, resulting from a decline in non-residents'
deposit and repo holdings in Greece and an increase in residents' corresponding
holdings abroad, as well as from the repayment of loans granted to residents by
In January-February 2008, direct investment showed a
net outflow of €195 million, as net inflows of non-residents' ' funds for direct
investment in Greece came to €91 million, while net outflows of residents'
funds for direct investment abroad reached €285 million, concerning mainly the
aforementioned investments that were recorded in February, as well as a €80
million outflow (recorded in January) which concerned a capital injection to EFG
SPOLKA AK (Poland) by EUROBANK. During the same period, a net inflow of €11,317
million was recorded under portfolio investment, as the inflow of non-residents'
funds for investment in Greece (mainly in Greek government bonds, of €16
billion) was considerably higher than residents' fund outflows for investment in
foreign bonds (worth €4.8 billion). Finally, under ''other'' investment, a net outflow of €8,196 million reflects considerable outflows of
residents ' funds for investment in deposits and repos abroad, a decline in non-residents'
corresponding investment in Greece, as well as the repayment of loans granted by
non-residents to residents.
At end-February 2008, Greece ' s reserve assets reached €2.3
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 March 2008 will be
released on 22 May 2008.