Balance of Payments: March 2021

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Balance of Payments: March 2021 21/05/2021 - Press Releases

Current account

In March 2021, the current account showed a deficit of €1.5 billion, up by €343 million year‑on‑year. This development is attributable 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.

The rise in the deficit of the balance of goods is accounted for by a larger increase in the value of imports than of exports. The value of imports grew by 29.7% (4% at constant prices) and the value of exports by 37.1% (17.1% at constant prices). It should be noted that non-oil exports of goods grew by 34.8% (31.8% at constant prices) and the corresponding imports by 39.3% (38.9% at constant prices).

A decline in the services surplus is attributable to a year‑on‑year deterioration in the transport balance and the travel balance, while the other services balance improved year‑on‑year. Non‑residents' arrivals and the corresponding receipts fell by 75.9% and 63.0%, respectively. The surplus of the transport balance decreased by 18.8%.

In March 2021, the surplus of the primary income account more than doubled, mainly on account of higher other primary income net receipts. The secondary income account recorded a small deficit, against a surplus in the same month of 2020, chiefly as a result of lower receipts in the other sectors of the economy excluding general government.

In the first quarter of 2021, the current account deficit declined by €826 million year‑on‑year and stood at €2.7 billion. This development is attributable to an improvement in the balance of goods and the primary income account, which was partly offset by a decrease in the surplus of the services balance and the secondary income account.

The drop in the deficit of the balance of goods is accounted for by a larger increase in the value of exports than of imports. Exports grew by 10% at current prices (8.9% at constant prices), while imports rose by 1.8% (fell by 5.4% at constant prices). It should be noted that non‑oil exports of goods increased by 9.1% at constant prices and the corresponding imports by 8.6%.

A decrease in the services surplus is attributable to a deterioration in the travel balance and the transport balance, while the other services balance improved. Non‑residents' arrivals and the relevant receipts fell by 85.2% and 86.1%, respectively, year‑on‑year. Net sea transport receipts dropped by 7.6%. Lastly, the surplus of the primary income account more than doubled, while the surplus of the secondary income account decreased substantially.

Capital account

In March 2021, the capital account registered a deficit of €288 million, against a surplus of €116 million year-on-year. In the first quarter of 2021, the capital account surplus dropped year‑on‑year to stand at €192 million.

Combined current and capital account

In March 2021, the deficit of the combined current and capital account (corresponding to the economy's external financing requirements) increased to €1.8 billion, from €1.0 billion in March 2020. In the first quarter of 2021, the deficit of the combined current and capital account fell by €761 million year‑on‑year and stood at €2.5 billion.

Financial account

In March 2021, under direct investment, residents' external assets rose by €449 million and their external liabilities, which represent non‑residents' direct investment in Greece, grew by €324 million.

Under portfolio investment, a decrease in residents' external assets is almost exclusively due to a decline of €3.0 billion in their holdings of foreign bonds and Treasury bills. A small increase in residents' external liabilities is due to a rise of €120 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 €1.2 billion in loans extended to non‑residents, which was partly offset by a decrease of €874 million in residents' deposit and repo holdings abroad. A decline in residents' liabilities reflects a €3.2 billion drop in the outstanding debt to non‑residents (including early repayment of tranches of an IMF loan to general government), which was partly offset by a rise of €2.5 billion in non‑residents' deposit and repo holdings in Greece (the TARGET account included).

In the first quarter of 2021, under direct investment, residents' external assets increased by €493 million and residents' external liabilities rose by €909 million.

Under portfolio investment, an increase in residents' external assets is mainly attributable to a rise of €1.6 billion in residents' holdings of foreign bonds and Treasury bills and a rise of €515 million in their holdings of foreign equities. An increase in residents' external liabilities is due to a rise of €1.6 billion in non‑residents' holdings of Greek government bonds and Treasury bills.

Under other investment, an increase in residents' external assets reflects mainly a rise of €1.7 billion in loans extended to non‑residents, which was partly offset by a decrease of €1.5 billion in residents' deposit and repo holdings abroad. A rise in residents' external liabilities reflects chiefly an increase of €5.2 billion in non‑residents' deposit and repo holdings in Greece (the TARGET account included), almost half of which was offset by a decline in the outstanding debt to non‑residents.

At end‑March 2021, Greece's reserve assets stood at €9.1 billion, compared with €8.5 billion at end‑March 2020.

Note: Balance of payments data for April 2021 will be released on 18 June 2021.