2006-06-16
The balance in the current account.
In April 2006, the current account deficit (CAD) in the country?s payment of balance formed LTL 564.3 million, a decrease of 269.6 million, 32.3 per cent, compared to March. According to preliminary figures, in January-April, CAD was LTL 2.2 billion (LTL 1.85 billion in January-April 2005). Compared to March 2006, the foreign trade deficit went down 38.2 per cent, the current transfer balance surplus contracted 3.4 times whereas the revenue balance deficit remained broadly unchanged.
According to the data published by the Department of Statistics under the Government of the Republic of Lithuania, the export of goods shrank 10.1 per cent month on month in April 2006 and imports decreased 17 percent. The downward trend in April with regard to the country?s export and import of goods was a result of a decrease in the trade of mineral products, mechanical appliances and textile. In January-April this year, nearly two thirds of the Lithuanian exports of goods accounted for the sales to the EU whereas imports made up 58.4 percent. The exports to CIS countries formed 18.1 per cent and imports. 32.5 percent.
In April 2006 compared to the previous month, the export of services hiked 6.7 per cent and the imports of services grew 3.2 percent making the positive service balance surplus rose LTL 28.2 million to LTL 176.9 million.
In April 2006, the cash outflows to non-residents (for their investments in Lithuania) constituted LTL 260.5 million, an increase from LTL 232.million in March, whereas the income of domestic economy agents from investments in other countries formed LTL 54.1 million (LTL 55.2 million in March). A surge in the cash outflows, the investment income balance deficit hiked LTL 29.6 million. Including the increased positive labour income balance, gross income balance deficit, went down month on month LTL 2.4 million to 177.6 million in April, while for January-April gross income balance deficit gross income balance deficit amounted to LTL 582.9 million although in the corresponding period in 2005 it was LTL 654.6 million.
In April this year, the balance surplus of the current transfers equalled to LTL 62.8 million, while in March it stood at LTL 211.6 million. In April, the transfers from the EU support funds made up LTL 73.3 million, a slump of LTL 177.7 million compared to March. This was the major reason behind the gross decrease in the balance of current transfers in April. In January-April 2006, the transfers from the EU support funds constituted LTL 521.5 million, while in January-April 2005 they stood at LTL 361.6 million.(both outward and inward investments) showed the total net capital inflow of LTL 571.8 million. In the first four months of the year, the gross net inflow of capital amounted to LTL 2.4 billion, of which 61.4 per cent accounted for net other investment inflows (mainly determined by the inflows in monetary financial institutions. The non repayable capital transfers from the EU support funds equalled to LTL 27.9 million in April, while in January-April, they stood at LTL 261.7 million (year on year, this type of transfers made up LTL 331.7 million).
The balance in capital and financial accounts.
In April 2006, excluding official foreign reserves, the investment flow from domestic economy agents to other countries formed LTL 652.7 million, while foreign investment flows in Lithuania amounted to LTL 1.22 billion. Net investment flow
In April 2006, the direct foreign investment flow in Lithuania formed LTL 100.4 million. Month on month, the direct investment flow to Lithuania decreased LTL 78.6 million. In the period from January to April, this flow constituted LTL 502 million (year on year, it was equal to LTL 951.9 million).
Upon having evaluated the direct investment of the domestic economy agents in other countries, the net direct foreign investment flow in Lithuania formed LTL 57.4 million.
The net investment portfolio flow was negative ( at LTL 6 million), in April 2006. This happened because the liabilities decreased more than the claims to non residents.
During the same reporting period, the net flow of other investments and financial derivatives was positive, standing at LTL 520.4 million). The loans received by the domestic banks and an increase in non-residential deposits in the domestic commercial banks were the major reason for the overall positive flow of this type of investments.
In April 2006, a decrease was registered in the country's official foreign reserve assets. In the balance of payments, this flow formed LTL 126.3 million. In April, the official foreign reserve assets decreased also due to currency deposits of the monetary financial institutions with the Bank of Lithuania and a drop in the external liabilities of the Bank of Lithuania by LTL 253.2 million and LTL 55.4 million respectively. The reserve assets melted also because of a decrease of LTL 20.9 million in the deposits of the central government with the Bank of Lithuania, as well as some other factors.
The growth of official reserve assets by LTL 214.8 million was a result of bigger net amount of the currency in circulation.