Balance of Payments: March 2024
21/05/2024 - Press Releases
- In March 2024, the current account deficit rose year-on-year, due to a deterioration in the secondary income account and, to a lesser extent, in the goods and services balances, while the primary income account improved.
- In the first quarter of 2024, the current account deficit increased year‑on‑year, owing to a worsening in the balance of goods and the primary income account, which was partly offset by an improvement mainly in the secondary income account and, to a lesser extent, in the balance of services.
Current account
In March 2024, the current account deficit recorded an increase of €296.8 million year-on-year and stood at €2.7 billion.
The deficit of the balance of goods recorded a marginal increase, as the decline in exports was almost fully offset by lower imports. At current prices, exports fell by 11.4% (‑14.9% at constant prices) and imports decreased by 7.4% (-5.3% at constant prices). More specifically, non-oil exports of goods at current prices fell by 16.4% (‑18.8% at constant prices), while the corresponding imports dropped by 2.0% (-1.2% at constant prices).
A small decrease in the services surplus is attributable to a shift from net receipts to net payments in the other services balance, which was partly offset by an improvement in the transport and travel balances. Compared with March 2023, non-residents’ arrivals rose by 31.2% and the relevant receipts grew by 34.2%.
The deficit of the primary income account contracted year-on-year, reflecting chiefly an increase in net receipts from other primary income and secondarily a decrease in net interest, dividend and profit payments. The secondary income account recorded a deficit, against a surplus in March 2023, as net payments were recorded in general government, instead of net receipts[1].
In the first quarter of 2024, the current account deficit recorded an increase of €255.3 million year‑on‑year and stood at €4.2 billion. The goods deficit grew, reflecting a larger drop in exports than in imports. At current prices, exports fell by 10.7% (‑11.4% at constant prices) and imports decreased by 1.9% (+1.5% at constant prices). More specifically, non-oil goods exports at current prices declined by 9.0%, while the corresponding imports increased by 3.0% (‑11.0% and 3.9% at constant prices, respectively).
A rise in the services surplus is due to an improvement in both the travel balance and the transport balance, while the surplus of the other services balance declined. Compared with the first quarter of 2023, non-residents’ arrivals rose by 24.5% and the relevant receipts grew by 28.2%.
The primary income account registered a deficit, against a surplus in the first quarter of 2023, mainly owing to a drop in net receipts from other primary income. The secondary income account surplus increased significantly year‑on‑year during this period, as a result of higher net receipts in the other sectors of the economy excluding general government.
Capital account
In March 2024, the capital account showed a deficit, against a surplus in March 2023, and stood at €108.5 million, reflecting net payments, instead of net receipts, recorded mainly in the other sectors of the economy.
In the first quarter of 2024, the capital account showed a deficit, against a surplus in the corresponding period of 2023, standing at €424.9 million, mainly due to a decrease in general government net receipts.
Combined current and capital account
In March 2024, the deficit of the combined current and capital account (corresponding to the economy’s external financing requirements) grew against March 2023 and stood at €2.8 billion.
In the first quarter of 2024, the deficit of the combined current and capital account more than doubled year-on-year and stood at €4.6 billion.
Financial account
In March 2024, direct investment saw net flows of €158.8 million under residents’ external assets and net flows of €300.1 million under residents’ external liabilities, without any notable transactions.
Under portfolio investment, an increase in residents’ external assets is mainly attributable to a rise of €707.0 million in residents’ holdings of foreign bonds and Treasury bills. A drop in their liabilities is due to a decrease of €1.3 billion in non-residents’ holdings of Greek bonds and Treasury bills, which was partly offset by a rise in non-residents’ holdings of Greek equity.
Under other investment, a rise in residents’ external assets stemmed from a €322.0 million statistical adjustment associated with the issuance of banknotes, as well as a €203.5 million increase in non-residents’ loans to residents. An increase in residents’ external liabilities reflects chiefly a rise of €3.3 billion in non-residents' deposit and repo holdings in Greece (including the TARGET account) and, to a lesser extent, a €322.0 million statistical adjustment associated with the issuance of banknotes, which were offset, to a degree, by a decline of €215.3 million in the outstanding debt to non‑residents.
In the first quarter of 2024, direct investment showed a €443.3 million flow into residents’ external assets and a €1.2 billion flow into residents’ external liabilities representing non‑residents’ direct investment in Greece.
Under portfolio investment, an increase in residents’ external assets is mainly due to a rise of €2.0 billion in residents’ holdings of foreign bonds and Treasury bills. An increase in their liabilities largely reflects a rise of €3.7 billion in non‑residents’ holdings of Greek bonds and Treasury bills.
Under other investment, a drop in residents’ external assets is mainly due to a decline of €2.6 billion in residents’ deposit and repo holdings abroad and, to a lesser extent, a €968.0 million statistical adjustment associated with the issuance of banknotes. A decline in their liabilities is mainly associated with a decrease of €1.9 billion in their outstanding debt to non‑residents and, to a lesser extent, a drop of €874.0 million in non‑residents’ deposit and repo holdings in Greece (including the TARGET account), as well as a €968.0 million statistical adjustment related to the issuance of banknotes.
At end‑March 2024, Greece’s reserve assets stood at €13.0 billion, compared with €12.1 billion at end‑March 2023.
Note: Balance of payments data for April 2024 will be released on 20 June 2024.
[1]It should be noted that March 2023 saw the transfer to the Greek government of the last tranche of income earned on ANFA/SMP holdings, which was recorded under the secondary income account.