2004-06-16
A sizeable widening of the foreign trade deficit determined further widening of the balance of payments current account deficit. In April 2004, the balance of payments current account deficit (CAD) made up LTL 985.7 million. It widened by LTL 453.9 million compared to March 2004, and by LTL 390.4 million year-on-year.
According to the data of the Department of Statistics, in April 2004, compared to March, export of goods increased by 2.4 per cent, while import of goods grew by 19.1 per cent (excluding mineral products, export of goods rose by 11.6% and import of goods by 19.5%). Year-on-year, in April 2004 export of goods increased by 34.1 per cent, while import grew by 31.1 per cent. Compared to March, the largest increase was recorded in the export of prepared foodstuffs (35.9%) and vehicles (43%).
Compared to March, export of services decreased in April by 0.3 per cent, while import of services went down by 2.8 per cent. The positive services balance increased by LTL 8.4 million and amounted to LTL 136.8 million. Year-on-year, export of services increased by 11.7 per cent, while import of services grew by 21.4 per cent. The positive balance of services contracted over the period under review by LTL 10 million.
In April, compared to March, payments to non-residents on their investment in Lithuania went slightly down and amounted to LTL 233.3 million. Compared to March, Government interest payments to non-residents on debt securities declined in April, while dividend payments to non-residents on foreign direct investment in the private sector rose. Due to the above changes, the total income balance was negative in April 2004 (LTL 172.6 million). Compared to March, it widened by LTL 2.8 million, and by LTL 65.2 million year-on-year.
The balance of current transfers was positive in April 2004 at LTL 68.7 million, up by LTL 12.7 million year-on-year.
The positive capital and financial account balance made up LTL 887.8 million in April 2004. Excluding reserve assets, both investment flows abroad by domestic economic entities (LTL 423.3 million) and non-resident investment flows in Lithuania (LTL 672.9 million) resulted in total net inflows in Lithuania.
Net inflows from Government foreign assets made up LTL 172.6 million in April 2004. Foreign assets of domestic commercial banks declined because of repaid non-resident loans and the contraction of overnight deposits in foreign banks (net inflows made up LTL 175.1 million).
Foreign direct investment flows in Lithuania were positive in April 2004 (LTL 331.2 million). These developments were determined by reinvestment and loans received from the investors. Taking into account foreign direct investment by domestic economic entities, net foreign investment inflows made up LTL 320.8 million in April.
Net portfolio investment flows were negative in April (LTL -155.7 million), resulting from the sale of part of Lithuanian eurobonds by non-residents to domestic commercial banks.
Other investment flows were positive in April (LTL 456 million). These investment flows were determined by investment in the banking sector as a result of an increase in non-resident deposits and balances on correspondent accounts, foreign loans and trade credit to other sectors. Other investment flows were slowed down by the repayment of earlier foreign loans by the Government (LTL 196.3 million).
Reserve assets continued to grow in April 2004, reflected by the positive flows in the balance of payments of LTL 217.5 million. The main reason behind the increase of reserve assets was the growth of Bank of Lithuania repo transactions with non-residents of LTL 132.4 million. Reserves were also boosted by Bank of Lithuania foreign exchange operations with the central government and commercial banks. Net purchase of foreign exchange from commercial banks amounted to USD 32.8 million in April.
Reserve assets were pushed down by LTL 12.3 million due to the revaluation of gold reserves.