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Balance of Payments: April 2021

18/06/2021 - Press Releases

  • In April 2021, the current account deficit grew year‑on‑year and stood at €2.1 billion, due to a deterioration in the balances of goods and services and the secondary income account, which was partly offset by an improvement in the primary income account.
  • In January-April 2021, the current account deficit registered a small increase year‑on‑year and stood at €4.8 billion, due to a deterioration in the balances of goods and services and the secondary income account, which was offset by an improvement in the primary income account. 


Current account

In April 2021, the current account showed a deficit of €2.1 billion, up by €933 million year‑on‑year.

The rise in the deficit of the balance of goods by €698 million is attributable to a stronger increase in the value of imports in absolute terms than in the value of exports. Specifically, exports grew by 56.6% (21.5% at constant prices) and imports by 56.0% (21.7% at constant prices). In particular, non‑oil exports of goods rose by 42.1% (38.1% at constant prices) and the corresponding imports by 47.0% (45.4% at constant prices).

The surplus in the services balance registered a small decline of €84 million, which was due to a deterioration in the transport balance, while the travel balance and the other services balance improved year‑on‑year. Non-residents' arrivals and the corresponding receipts rose by 185.6% and 210.9%, respectively. The surplus of the transport balance dropped by 24.8%, mainly on account of a 3% decrease in net sea transport receipts. 

In April 2021, the deficit of the primary income account fell almost by half, mainly on account of lower net interest, dividend and profit payments. The deficit of the secondary income account more than doubled against the same month of 2020, chiefly as a result of higher general government payments.

In the January-April 2021 period, the current account deficit recorded a small increase of €107 million year‑on‑year and stood at €4.8 billion.

An increase in the deficit of the balance of goods is attributable to the fact that the value of imports grew more than the value of exports, despite the fact that the latter grew faster. Exports increased by 19.6% at current prices (11.5% at constant prices), while imports rose by 12.5% (remaining almost unchanged at constant prices). Specifically, non‑oil exports of goods grew by 15.6% at constant prices and the corresponding imports by 16.3%.

A decrease in the services surplus is attributable to a deterioration in the transport balance and the travel balance, while the other services balance improved. Non-residents’ arrivals and the relevant receipts fell by 79.7% and 79.3%, respectively, year‑on‑year. Net transport receipts dropped by 22.9%.

Lastly, the surplus of the primary income account more than doubled, chiefly due to lower interest, dividend and profit payments, while the secondary income account turned from surplus to deficit mainly on the back of higher general government payments.


Capital account

In April 2021, the capital account surplus decreased by €105 million year‑on‑year and stood at €30 million. In the January-April 2021 period, the capital account surplus fell by €170.3 million year‑on‑year and stood at €221 million, owing to a rise in the net payments of the other sectors (excluding general government). 


Combined current and capital account

In April 2021, the deficit of the combined current and capital account (corresponding to the economy's external financing requirements) doubled against April 2020 and stood at €2.0 billion.  In the January-April 2021 period, the deficit of the combined current and capital account grew by €278 million year-on-year and stood at €4.6 billion.


Financial account

In April 2021, under direct investment, residents' external assets increased by €24 million and residents' external liabilities rose by €181 million.

Under portfolio investment, a decrease in residents’ external assets is almost exclusively due to a decline of €2.8 billion in their holdings of foreign bonds and Treasury bills. A decline in residents' external liabilities is due to a decrease of €835 million 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 €159 million in loans extended to non-residents and a statistical adjustment of €408 million associated with the issuance of banknotes. A decline in residents’ external liabilities reflects a drop of €6 billion in non‑residents’ deposit and repo holdings in Greece, which was partly offset by a €5.8 billion rise in the outstanding debt to non-residents.[1]

In the January‑April 2021 period, under direct investment, residents’ external assets rose by €518 million and residents’ external liabilities, which represent non-residents’ direct investment in Greece, increased by €1.1 billion.

Under portfolio investment, a decrease in residents’ external assets is mainly attributable to a drop of €1.2 billion in residents’ holdings of foreign bonds and Treasury bills, which was partly offset by a rise of €703 million in their holdings of foreign equities. An increase in residents' external liabilities is due to a rise of €711 million in non-residents' holdings of Greek government bonds and Treasury bills.

Under other investment, an increase in residents’ external assets reflects a rise of €1.5 billion in loans extended to non‑residents, which was partly offset by a decrease of €1.2 billion in residents’ deposit and repo holdings abroad. An increase in external liabilities chiefly reflects a rise of €3.2 billion in the outstanding debt to non-residents, which was partly offset by a decrease of €733 million in non‑residents’ deposit and repo holdings in Greece (the TARGET account included).

At end‑April 2021, Greece's reserve assets stood at €9.0 billion, compared with €8.8 billion at end‑April 2020.


Related Information: Balance of payments data for May 2021 will be released on 21 July 2021.

 


[1] Developments under portfolio investment also include securitisation transactions by financial institutions.

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