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‘Opening’ of the current account deficit in January – February

In February 2022, the current account deficit increased compared to February 2021, due to the increase in the goods deficit, which was partially offset by the improvement in the primary and secondary income balances, a small increase in the primary and secondary income The Bank of Greece emphasizes in its announcement.

In the period January-February 2022, the current account deficit increased compared to the same period of 2021, due to the deterioration of the goods balance, which was to some extent offset by the improvement of other balances.

Current Balance

In February 2022, the current account deficit increased by 1.4 billion euros compared to the corresponding month of 2021 and amounted to 2.1 billion euros.

The increase in the goods deficit is due to the increase in imports, which was higher than in exports. Exports increased by 26.3% at current prices (4.3% at constant prices) and imports by 64.6% at current prices (37.5% at constant prices). In particular, exports of non-fuel goods increased by 27.5% at current prices (14.6% at constant prices) and imports of non-fuel goods increased by 38.1% at current prices (29.2% at constant prices). ).

The increase in the balance of services surplus is due to the improvement in the balance of travel services and the balance of other services, which was partially offset by the decrease in the surplus of the transport balance. Arrivals of non-resident travelers increased by 314.8% and related receipts by 302.5% compared to 2021. The surplus of the transport balance decreased despite the improvement of the surplus of the maritime transport balance.

The surplus of the primary income balance increased in relation to the corresponding month of 2021, mainly due to the increase of receipts from other primary incomes. The secondary income balance recorded a surplus against a deficit compared to the corresponding month of 2021 due to the improvement of the general government balance.

In the period January-February 2022, the current account deficit increased by 2.9 billion euros compared to the first two months of 2021 and amounted to 4.1 billion euros.

The increase in the goods deficit is due to the larger increase in imports compared to exports. More specifically, exports increased by 30.5% at current prices (7.1% at constant prices) and imports increased by 61.3% at current prices (34.7% at constant prices). In particular, at current prices, exports and imports of non-fuel goods increased by 25.2% and 40.0% respectively (13.1% and 30.9% at constant prices).

The increase in the balance of services surplus is due to the improvement in the balance of travel services and the balance of other services, which was partially offset by the decrease in the surplus of the transport balance. Arrivals of non-resident travelers increased by 282.5% and related receipts by 306.2% compared to the first two months of 2021 (representing 56.6% and 63.7% of the respective levels of 2019).

Net receipts from transfers decreased by 5.8%.
The primary income balance surplus increased in relation to the same period of 2021, due to the increase in net receipts from other primary income, while the surplus of the secondary income balance more than doubled due to the increase in net income from other primary income, .

Capital Balance

In February 2022, the capital balance recorded a surplus, compared to a deficit in the corresponding month of 2021 and amounted to 27.7 million euros. In the period January-February 2022, the capital balance recorded a deficit, compared to a surplus in the corresponding period of 2021 and amounted to 194.2 million euros.

Total Balance of Current Transactions and Capital

In February 2022, the total current account and capital deficit (which corresponds to the needs of the economy for foreign financing) increased by 1.3 billion euros compared to February 2021 and amounted to 2.1 billion . euro. In the period January-February 2022, the deficit of the total current account and capital balance widened compared to 2021 by 3.6 billion euros, reaching 4.3 billion euros.

Financial Transaction Balance

In February 2022, in the category of direct investments, residents ‘receivables from abroad increased by 31.3 million euros, while residents’ liabilities to foreigners increased by 1.1 billion euros, with the main transaction being share capital increase and intra-group lending of MSCIF DYNAMI BIDCO SOLE SHAREHOLDER SA from its parent company, SPEAR WTE INVESTMENTS SARL (Luxembourg), for the purpose of the partial acquisition of HEDNO SA

In portfolio investments, the increase in residents’ receivables from abroad is due to the increase by 2.1 billion euros of their placements in bonds and bonds abroad. The reduction of their liabilities is due to the reduction of non-residents’ investments in bonds and interest-bearing bills of the Greek State by 528.0 million euros.

In the category of other investments, there was a decrease in residents’ receivables from abroad, mainly due to the reduction of their deposits and repos abroad by 2.0 billion euros. The increase in their liabilities is mainly due to the increase by 862.0 million euros of non-resident placements in deposits and repos in Greece (including the TARGET account) and the statistical adjustment for the issuance of banknotes by 670.0 million euros.

In the period January-February 2022, in the category of direct investments, residents ‘receivables from abroad increased by 53.2 million euros and residents’ liabilities to foreigners, corresponding to direct investments of non-residents in Greece, increased by € 1.7 billion.

In portfolio investment, the increase in residents ‘receivables from abroad is mainly due to the 5.2 billion euro increase in residents’ investments in bonds and bonds abroad. The increase in their liabilities is due to the increase in non-resident placements in bonds and interest-bearing bills of the Greek State by 2.0 billion euros.

In the category of other investments, the decrease of residents ‘receivables from abroad is due to the decrease of 2.7 billion euros of residents’ deposits and repos abroad and the reduction of loans to non-residents by 273.3 million euros. . The increase in their liabilities mainly reflects the increase of 2.5 billion euros in non-resident deposits and repos in Greece (including the TARGET account) and the statistical adjustment associated with the issuance of 1.0 billion euro banknotes. .

At the end of February 2022, the country’s foreign exchange reserves amounted to 13.0 billion euros.

Source: Capital

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