Greece’s current account 2010-2011

The table below shows the development of Greece’s current account in 2011 (in BEUR):

2010 2011
Revenue from abroad
Exports 17 20
Services (e. g. tourism) 28 29
Other income 4 3
Current transfers 5 4
—- —-
Total revenue from abroad 54 57
Expenses abroad
Imports 45 47
Services (e. g. tourism) 15 14
Other expense (e. g. interest) 12 12
Current transfers 4 4
—- —-

Total expenses abroad 77 78
Net foreign deficit (current account) -23 -21

At first glance, the improvement in the current account deficit would appear encouraging, above all the much steeper increase in exports than in imports. The Bank of Greece warns, however, that the lower increase in imports is exclusively due to the recession. Without structural reforms, imports will “explode” again as soon as there is economic growth.

The discouraging fact is that, after 3 or 4 years of crisis and so-called austerity measures, Greece as a country is still spending 1.368 Euros abroad for every 1.000 Euros earned abroad. That is a 37% excess of spending over income. This is much worse when only considering the trade account where Greece is importing 2.350 Euros for every 1.000 Euros which it is exporting!

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