Balance of Payments: October 2022
21/12/2022 - Press Releases
- In October 2022, the current account deficit grew year on year, mainly due to a deterioration in the balance of goods and, to a lesser extent, in the balance of services, which was partly offset by an improvement in the primary and the secondary income account.
- In the January-October 2022 period, the current account deficit grew year on year, chiefly owing to a worsening of the balance of goods, as well as of the primary and the secondary income account, which was offset to a degree by an improvement in the balance of services.
Current account
In October 2022, the current account deficit increased by €1.6 billion year on year and stood at €2.7 billion.
A rise in the deficit of the balance of goods is accounted for by a larger increase in imports than in exports. Exports grew by 28.3% at current prices (0.5% at constant prices) and imports rose by 42.5% at current prices (19.3% at constant prices). In particular, non-oil exports of goods grew by 16.6% at current prices (0.9% at constant prices) and non-oil imports of goods rose by 20.5% at current prices (13.1% at constant prices).
A decrease in the surplus of the services balance is attributable to a deterioration in the transport and other services balances, while the travel balance improved. Non-residents’ arrivals rose by 28.6% and the relevant receipts by 16.7% year on year. It should be noted that receipts exceeded their October 2019 level and stood at 103.3%, while arrivals almost reached the corresponding level (99.4%). The surplus of the transport balance dropped despite an amelioration of the sea transport balance.
The deficit of the primary income account fell year on year, owing mainly to lower interest, dividend and profit payments. The deficit of the secondary income account also decreased year on year.
In the January-October 2022 period, the current account deficit rose by €6.3 billion year on year and stood at €13.6 billion.
A rise in the deficit of the balance of goods is accounted for by a larger increase in imports than in exports. Exports grew by 39.5% at current prices (5.3% at constant prices) and imports increased by 46.4% at current prices (20.5% at constant prices). Specifically, non-oil exports and imports of goods grew, respectively, by 25.5% and 28.0% at current prices (8.5% and 19.2% at constant prices).
A rise in the surplus of the services balance is due to an improvement mainly in the travel balance, as well as in the transport and other services balances. Non-residents’ arrivals rose by 92.1% and the relevant receipts by 70.4% year on year, representing 88.9% and 97.4% of their respective levels in 2019. Net transport receipts increased by 13.7%.
The primary income account surplus decreased year on year, mainly due to lower net receipts of other primary income. The secondary income account registered a deficit, against a surplus in the corresponding period of 2021, reflecting net general government payments, against net receipts.
Capital account
In October 2022, the capital account registered a surplus, against a deficit in the same month a year earlier, and stood at €135.4 million, as a result of lower payments in the other sectors of the economy excluding general government. In the January-October 2022 period, the capital account surplus declined year on year and stood at €2.7 billion, owing to lower general government net receipts.
Combined current and capital account
In October 2022, the deficit of the combined current and capital account (corresponding to the economy’s external financing requirements) more than doubled and stood at €2.6 billion. In the January-October 2022 period, the deficit of the combined current and capital account increased by €6.7 billion year on year and stood at €10.9 billion.
Financial account
In October 2022, under direct investment, residents’ external assets increased by €134.0 million and residents’ external liabilities rose by €392.7 million, without any remarkable transactions.
Under portfolio investment, a decrease in residents’ external assets is chiefly attributable to a decline of €959.0 million in residents’ holdings of foreign bonds and Treasury bills. A decline in their liabilities is mostly due to a decrease of €481.0 million in non-residents’ holdings of Greek bonds and Treasury bills.
Under other investment, a drop in residents’ external assets is due to a decline of €753.0 million in residents’ deposit and repo holdings abroad and to a decrease of €435.3 million in loans extended to non-residents, which were partly offset by a €236.0 million statistical adjustment associated with the issuance of banknotes. An increase in their liabilities reflects chiefly a rise of €889.0 million in non-residents’ deposit and repo holdings in Greece (the TARGET account included), as well as a €236.0 million statistical adjustment related to the issuance of banknotes, which were partly offset by a drop of €233.1 million in the outstanding debt to non-residents.
In the January-October 2022 period, under direct investment, residents’ external assets increased by €1.1 billion and residents’ external liabilities, which represent non-residents’ direct investment in Greece, rose by €5.7 billion.
Under portfolio investment, an increase in residents’ external assets is mainly attributable to a rise of €8.7 billion in residents’ holdings of foreign bonds and Treasury bills. An increase in their liabilities is attributable to a rise of €83.0 million in non-residents’ holdings of Greek bonds and Treasury bills and a rise of €78.0 million in non-residents’ holdings of shares of Greek firms.
Under other investment, a drop in residents’ external assets is due to a decline of €6.6 billion in residents’ deposit and repo holdings abroad, which was partly offset by a €3.9 billion statistical adjustment associated with the issuance of banknotes. An increase in residents’ external liabilities reflects chiefly a rise of €10.6 billion in non-residents’ deposit and repo holdings in Greece (the TARGET account included) and a €3.9 billion statistical adjustment associated with the issuance of banknotes, which were partly offset by a decline of €5.1 billion in the outstanding debt to non-residents.
At end-October 2022, Greece’s reserve assets stood at €11.1 billion, compared with €12.3 billion at end-October 2021.
Note: Balance of payments data for November 2022 will be released on 20 January 2023.