2005-05-13
Current account balance. In March 2005 the current account deficit (CAD) contracted by LTL 245.7 million month on month to LTL 156.7 million. This contraction was mostly determined by the narrowing of the foreign trade deficit and a higher surplus of the balance of current transfers. Year on year the CAD narrowed more than 3 times. In January to March 2005, the CAD amounted to LTL 655.8 million, contracting by LTL 326.2 million year on year. According to preliminary estimates, the CAD in the first quarter made up LTL -4.4 per cent of GDP (-7.5% in Q1 2004).
According to the preliminary data of the Department of Statistics, in March 2005 export of goods increased by 23.2 per cent, while import of goods grew by 13.1 per cent month on month. Year on year, export of goods went up by 29.3 per cent, while import of goods increased by 12.8 per cent.
Export of services increased in March 2005 by 26.6 per cent, while import of services went up by 20.9 per cent month on month. The total positive balance of services increased by LTL 48.8 million in March and amounted to LTL 153 million. Year on year, export of services increased by 9.7 per cent, while import of services grew by 26 per cent. The surplus of the positive balance of services declined over the period under review by LTL 39.7 million.
Payments to non-residents (on their investment in Lithuania) made up LTL 276.3 million in March 2005 (LTL 169.2 in February), while the income of domestic economic entities (on investment abroad) made up LTL 50 million (LTL 44.5 million in February). The deficit of the investment income balance increased by LTL 101.6 million over the period under review, while the surplus of the compensation balance went up by LTL 10.2 million. Due to the above changes, the total deficit of the income balance widened by LTL 91.5 million month on month (to LTL 177 million).
The surplus of the balance of current transfers stood at LTL 250.6 million in March 2005 (LTL 69.2 million in February). This surplus of the balance of current transfers resulted from higher payments from the EU structural funds which increased by LTL 169.7 million. In March 2004, the surplus of the balance of current transfers was lower by LTL 129.9 million and stood at LTL 120.7 million.
Capital and financial account balance. In March 2005, the total investment flow abroad by domestic economic entities, excluding international reserves, stood at LTL 526.6 million and the foreign investment flow in Lithuania (total net inflows) made up LTL 480 million.
Foreign direct investment flow in Lithuania amounted to LTL 238.6 million in March 2005. Compared to January and February, this flow in March was the highest. Taking into account foreign direct investment by domestic economic entities, net foreign direct investment inflows made up LTL 197.8 million in March 2005. Net foreign direct investment flow made up 126.2 per cent of the CAD in March.
Net portfolio investment flow showed net inflows in March 2005 (LTL 34.1 million), which was determined by lower investment of domestic commercial banks in non-resident debt securities.
Net other investment flow was negative in March 2005 (LTL -270.8 million). The increase of time deposits of domestic commercial banks in foreign banks had the largest impact on the rise of the negative total flow of this investment.
International reserves continued to grow in March 2005. Their positive flow in the balance of payments stood at LTL 42.9 million. The reserves were also increased by higher credit institution balances with the Bank of Lithuania (LTL 63.3 million) and higher other net liabilities.
Factors decreasing international reserves were lower Bank of Lithuania foreign liabilities (LTL 22.6 million), a contraction of central government deposits at the Bank of Lithuania (LTL 13.3 million) and a decline of the volume of currency issued by the Bank of Lithuania (LTL 4.9 million).