Croatia Records Large Balance of Payments Surplus

Total Croatia News

ZAGREB, March 31, 2018 – Last year, Croatia achieved a surplus in the current account balance of payments of 1.9 billion euros, which is 695 million kuna more than in 2016, and despite a big deficit in foreign trade, the surplus was mostly a result of positive trends in the services account, particularly tourism, which generated a record revenue of 9.5 billion euros, the latest data released by the Croatian National Bank (HNB) indicate.

According to the information HNB released on Friday, the surplus in the capital account last year amounted to 237 million euros so that balance of the current and capital account indicates a surplus of 2.14 billion euros.

“Despite the deterioration of the current and capital account balance recorded in the last quarter, the whole of 2017 saw an increase in the current and capital account surplus to 4.4% of GDP, which is 0.5 percentage points higher than in 2016. The continued growth in the net exports of services and the drop in the primary income account deficit (due to the fall in the profits of banks based on provisions for loans related to the Agrokor Group) contributed to the increase in the surplus,” HNB analysts said.

HNB’s latest data indicates that 2017 was the fifth consecutive year that a surplus was created in the current transactions account, with positive trends in the services account, as well as in the secondary income and capital account, while negative trends continued in the goods account.

The deficit in the goods account last year amounted to 8.16 billion euros, which is 817 million euros or 11.1% more than in 2016. The surplus in the services account recorded a growth of 629 million euro or 7.1% to 9.3 billion euros.

These positive trends were primarily caused by a record revenue from tourism and spending by foreign guests in Croatia. Revenue from tourism amounted to 9.49 billion euros, which is 9.9% or 858 million euros more than in 2016.

Positive trends were also recorded in the secondary income account, generating a surplus of 1.84 billion euros which, compared to 2016, was an increase of 34.3% or 470 million euros.

The deficit in the primary income account was reduced by 422 million euros or 28.1% to 1.08 billion euros.


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