Balance of Payments: April 2020

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Balance of Payments: April 2020 19/06/2020 - Press Releases

Current account

In April 2020, the current account registered a deficit of €1.1 billion, down by €264 million year-on-year, as a result of an improved balance of goods and primary income account, and despite a deterioration in the services balance and the secondary income account. The deficit of the balance of goods fell, as imports decreased more than exports. The drop in total exports and imports of goods largely reflects a decline in the value of oil exports and imports, due to a decrease in international oil prices. Oil exports at constant prices recorded a small decline of 2.4%, while the corresponding imports increased by 14.2%. Non-oil exports of goods fell by 13.2% at current prices and by 12.6% at constant prices. At the same time, non-oil imports of goods fell by 20.7% at current prices (-20.2% at constant prices), outpacing the fall in corresponding exports.

The surplus of the services balance shrank, reflecting a sharp deterioration in the travel and transport balances. Specifically, the surplus of the travel balance dropped to almost zero, as non-residents' arrivals and related receipts fell by 96.2% and 98.7%, respectively, and travel payments declined by 99.2%. The decrease in the transport surplus is mostly attributable to a drop of 14.5% in net receipts from sea transport services.

In January-April 2020, the current account deficit fell to €4.7 billion, down by €465 million year-on-year, as the balance of goods and the primary and secondary income accounts improved, more than offsetting the decrease in the services surplus.

The deficit of the balance of goods decreased, owing to an improvement of the non-oil balance of goods, while the oil balance deteriorated. As mentioned above, a decline in total exports and imports of goods mainly reflects a decrease in the value of oil exports and imports, amid falling international oil prices. In the first four months of 2020, oil exports at constant prices grew by 1.7% and the respective imports by 16.3%. Total exports of goods decreased by 8.6% at current prices (but recorded a rise by 4.5% at constant prices), while non-oil exports of goods remained almost unchanged both at current and at constant prices. Total imports of goods decreased by 9.7% at current prices and showed no significant change at constant prices.

The services surplus declined due to a deterioration across all its sub-components. Non-residents' arrivals and related receipts fell by 36.1% and 51.4%, respectively, while transport receipts declined by 3.2%.

Capital account

In April 2020, the capital account showed a surplus of €135 million, up from €29 million year-on-year, due to higher general government receipts. In the January-April 2020 period, the capital account showed a surplus of €391 million, up by €176 million year-on-year.

Combined current and capital account

In April 2020, the combined current and capital account (corresponding to the economy's external financing requirements) showed a deficit of €1.0 billion, down by €370 million year-on-year. In the January-April 2020 period, the deficit stood at €4.3 billion, down by €641 million year-on-year.

Financial account

In April 2020, under direct investment, residents' external liabilities (non-residents' direct investment in Greece) increased by €91 million, without any notable transactions.

Under portfolio investment, residents' external assets recorded an increase (of €7.1 billion), almost exclusively as a result of an increase in residents' holdings of foreign bonds and Treasury bills, which is mostly associated with loan securitisation of a domestic credit institution. A decrease in residents' external liabilities was mainly due to a decline of €4.2 billion in non-residents' holdings of Greek bonds and Treasury bills.

Under other investment, an increase of €11.5 billion in residents' external liabilities is attributable to a rise in deposit and repo holdings in Greece (the TARGET account included), also including the transaction related to the above-mentioned loan securitisation.

In January-April 2020, under direct investment, residents' external liabilities (stemming from non-residents' direct investment in Greece) stood at €976 million.

Under portfolio investment, residents' external assets recorded an increase, due to a rise in residents' holdings of foreign bonds and Treasury bills (€10.6 billion) and a decline in holdings of foreign equity and mutual fund shares (€404 million). A decrease in residents' external liabilities was mainly due to a decline of €5.4 billion in non-residents' holdings of Greek bonds and Treasury bills.

Under other investment, an increase in residents' external assets is mainly attributable to a rise of €1.3 billion in residents' deposit and repo holdings abroad and the statistical adjustment related to the issuance of banknotes (€1.1 billion). An increase in external liabilities mainly reflects a rise of €13.9 billion in non-residents' deposit and repo holdings in Greece (the TARGET account included) and a €7.2 billion rise in residents' external debt liabilities stemming from a reclassification of liabilities related to a systemic bank's securitised loans, which did not affect Greece's International Investment Position.

At end-April 2020, Greece's reserve assets stood at €8.8 billion, compared with €6.4 billion at end-April 2019.

Note: Balance of payments data for May 2020 will be released on 21 July 2020.