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Balance of payments: SEPTEMBER 2001

26/11/2001 - Press Releases

Current account balance

In September 2001, the current account balance recorded a 594 million euro deficit, i.e. 47 million euro less than in September 2000. This development is mainly related to an improvement in the trade balance and an increase in the transfers surplus, which together more than offset a fall in the services surplus and an increase in the income account deficit with respect to September 2000.

The decrease in the trade deficit is the result of a reduction mainly of the net oil bill, but also of the non-oil trade deficit, compared with September 2000. As regards the services balance, the decrease in its surplus stems from a fall in net transport receipts, while net travel receipts remained at the September 2000 level. The rise in the transfers surplus is due to an increase in net inflows from the EU, while the widening of the income account deficit is due to higher net interest payments.

In the January-September 2001 period, the current account deficit decreased by 273 million euro with respect to the corresponding period of 2000 and stood at 4,977 million euro. This development is due to a fall in the non-oil trade deficit and to a rise in both the services and the transfers surpluses. The income account deficit, however, almost doubled.

The decrease in the non-oil trade deficit in the January-September period is due to a considerable increase in export receipts, which more than offset a relatively small growth of the import bill. As a result, the non-oil trade deficit decreased by 467 million euro. By contrast, net oil imports rose by 62 million euro. The increase in net travel receipts led to a considerable rise in the services surplus, which financed a larger part of the trade deficit than in 2000, whereas net transport receipts declined in the period under review. The widening of the income account deficit stems mainly from an increase in net interest payments. Finally, the transfers balance recorded a larger surplus, due to an increase in net EU transfers after the first quarter of 2001 and to receipts from the sale of UMTS licenses, which were recorded under the "other items" category in August 2001.


Financial account balance

In September 2001, there was a net inflow of direct investment amounting to 340 million euro, whereas "other investment" showed a substantial outflow, exclusively attributable to an increase in residents' deposits abroad, which was more than double that of non-residents' deposits in Greece.

In the January-September 2001 period, direct investment recorded a 1,007 million euro net inflow, compared with a considerable outflow in the corresponding 2000 period. This development is mainly due to the inflow of capital for the acquisition of a part of INTERAMERICAN's share capital by EUREKO in July 2001 and to a decrease in residents' investment abroad. The net inflow for portfolio investment was higher than in the corresponding period of 2000 and reached 8,252 million euro, owing to the continuing inflow of funds, mainly for the purchase of Greek government bonds, including bonds convertible to equity. As regards the "outflow" appearing under "other investment", this is due, first, to the gradual release, since the beginning of the year, of commercial banks' foreign currency redeposits with the Bank of Greece and, second, to the adoption, as from 1 January 2001, of a new definition for reserve assets according to the guidelines of the European Central Bank, as has already been detailed in previous press releases.

As a result of developments in the current account and in the financial account, Greece's reserve assets (on the basis of the European Central Bank definition) stood at 7.5 billion euro (6.8 billion US dollars) at end-September 2001.

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