Montenegro's 9-mo current account gap narrows 29% y/y to EUR 232mn

By bne IntelliNews December 12, 2013

Montenegro's current account gap shrank 29.1% y/y to EUR 231.7mn in January-September 2013, due to narrowing foreign trade deficit and rising net income from abroad, data from the central bank, CBCG, showed. The 9-months current account gap equalled to 7.0% of the full-year projected GDP, down from nearly 10.0% a year ago, according to IntelliNews calculations.

Exports increased 3.8% y/y to EUR 305.4mn in January-September supported by higher electricity sales abroad. Imports shrank 4.1% to EUR 1,299.7mn over the period. Therefore, the 9-months foreign trade deficit improved to 30% of GDP from 32% of GDP a year earlier. The service account surplus rose 2.4% y/y to EUR 625.5mn underpinned by higher tourism proceeds (up 2.6% to EUR 617.2mn). The net income from abroad climbed 56.7% y/y to EUR 42.3mn over the period due to higher compensation of employees, likewise helping narrow the overall CA gap.

The financial account surplus fell to EUR 42.4mn in January-September from EUR 122.7mn a year ago. Net FDI contracted 14.8% to EUR 275.6mn over the period due to lower investments in equity and reinvested earnings.

Montenegro's 2012 current account gap to GDP ratio remained broadly unchanged at 17.6% of GDP in 2012, reflecting high foreign trade deficit, central bank data showed. It is expected to decline to 16.9% of GDP in 2013 and narrow further to 16.3% in 2014, likely reflecting strong exports growth, the EC said in its latest autumn forecast.

Montenegro's balance of payments, EUR mn Jan-Sep'12 Jan-Sep'13 y/y,%
Current account -326.7 -231.7 -29.1
--trade gap -1,060.9 -994.4 -6.3
--services 610.6 625.5 2.4
--income, net 27.0 42.3 56.7
--current transfers 96.7 94.8 -1.9
Capital account -0.1 0.5 -617.7
Financial account 122.7 42.4 -65.5
--FDI net 323.3 275.6 -14.8
--portfolio investments -2.8 -26.3 842.9
--other investments -104.5 -185.9 78.0
Changes in resrve assets of the CBCG -93.3 -21.0 -77.5
Net errors and omissions 204.0 188.9 -7.4
Source: CBCG      


Related Articles

Evolution Equity Partners closes $125mn cybersecurity-focused fund

Evolution Equity Partners announced on 17 July the final closing of a new fund with total capital commitments of $125mn to make investments in cybersecurity and next generation enterprise software ... more

Montenegrin court seizes passports of opposition leaders accused of coup attempt

Montenegro’s high court has seized the passports of two opposition leaders accused of plotting a coup as a precautionary measure. Andrija Mandic and Milan Knezevic – two of the leaders of the ... more

Russians continue to holiday in Montenegro despite warnings from Russian foreign ministry

The summer tourism season in Montenegro started earlier than expected and indicates that this year the revenue will exceed €1bn – the ... more