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

Veteran Montenegrin politician Milo Djukanovic to run for president in 2018

Montenegro’s ruling Democratic Party of Socialists (DPS) will most likely propose its veteran leader, former president and prime minister Milo Djukanovic, to ... more

Montenegrin court sentences opposition leader for protest violence

Montenegro’s court in Podgorica sentenced Milan Knezevic, one of the leaders of pro-Russian opposition Democratic Front, to 7 months in jail on October 18 ... more

Montenegro’s court unfreezes A2A's shares in power monopoly EPCG, paving way for sale of stake

The high court of Podgorica said it has decided to unfreeze the shares of Italy’s A2A in Montenegro’s power firm EPCG after ... more