- 听deficit at 鈧�137听billion (1.0% of euro area GDP) in 2022, down from 鈧�285听billion surplus (2.3% of GDP) a year earlier
- :听largest听bilateral current account听deficits听vis-脿-vis听China听(鈧�170听billion) and听Russia听(鈧�79听billion) and largest surpluses vis-脿-vis听United Kingdom听(鈧�137听billion) and听厂飞颈迟锄别谤濒补苍诲听(鈧�72听产颈濒濒颈辞苍)
- 听showed net assets of 鈧�265听billion (2.0% of euro area GDP)听at end of 2022
- Euro area financial assets vis-脿-vis听搁耻蝉蝉颈补听amounted to 鈧�308听billion (0.9% of euro area external assets) at end of the fourth quarter of 2022, down by 21% since end of previous quarter
Current account
罢丑别听current account听of theeuro area recorded a deficit of 鈧�137听billion (1.0% of euro area GDP) in 2022, after recording a surplus of 鈧�285 billion (2.3% of GDP) in 2021 (Table听1). This change was mainly driven by switches in the听goods听balance 鈥� from a surplus of 鈧�279听billion to a deficit of 鈧�85听billion 鈥� and, to a lesser extent, in the听primary income听balance 鈥� from a surplus of 鈧�65听billion to a deficit of 鈧�10听billion. Moreover, the deficit in听secondary income听edged up from 鈧�158听billion to 鈧�161听billion. These developments were slightly offset by a larger surplus for听services听(up from 鈧�99听billion to 鈧�119听billion).
The larger surplus for听services听in 2022 was mainly due to widening surpluses for听travel services听(from 鈧�24听billion to 鈧�53听billion),听telecommunication, computer and information services听(from 鈧�129听billion to 鈧�145听billion)and听transport services听(from 鈧�14听billion to 鈧�24听billion), while larger deficits were recorded for听other business services听(from 鈧�46听billion to 鈧�65听billion) and听other services听(from 鈧�28听billion to 鈧�47听billion).
The switch in the听primary income听balance from a surplus to a deficit was mainly due to a lower surplus in听direct investment income听(from 鈧�41听billion to 鈧�4听billion), a larger deficit in听portfolio equity income听(from 鈧�72听billion to 鈧�98听billion) and听a decline in the surplus for听other primary income听(from 鈧�8听billion to 鈧�0.1听billion), the latter mostly related to an increase in payments to the EU institutions.
Data on the geographical counterparts of the euro area current account (Chart 1) show that in 2022 the euro area recorded its largest bilateral deficits vis-脿-vis听China听(鈧�170听billion, up from 鈧�83听billion in 2021),听Russia听(鈧�79听billion, up from 鈧�22听billion) and the residual group of听other countries听(鈧�76 billion, after a surplus of 鈧�124 billion). The largest bilateral surpluses were recorded vis-脿-vis the听United Kingdom听(鈧�137听billion, down from 鈧�158听billion) and听Switzerland听(鈧�72听billion, up from 鈧�68听billion). Furthermore, in 2022 the euro area recorded an annual bilateral current account deficit of 鈧�37听billion vis-脿-vis the听United States, following a surplus of 鈧�57听billion in 2021.
The most significant changes in the geographical components of the current account in 2022 relative to 2021 were as follows. 罢丑别听goods听balance vis-脿-vis the residual group of听other countries听turned from a surplus of 鈧�38听billion to a deficit of 鈧�188听billion. This was partly due to a larger goods deficit with Norway (up from 鈧�14听billion to 鈧�75 billion) and increased imports from countries within the Organization of the Petroleum Exporting Countries, in both cases driven by larger imports of energy products. The deficit vis-脿-vis听China听increased from 鈧�112听billion to 鈧�191听billion and the deficit vis-脿-vis听搁耻蝉蝉颈补听rose from 鈧�40听billion to 鈧�92听billion,听mainly on account of higher prices for imported energy products.
滨苍听services, the surplus vis-脿-vis the听United Kingdom听widened (from 鈧�29听billion to 鈧�52听billion), mostly owing to exports of travel services, while the deficit vis-脿-vis the听United States听increased (from 鈧�81听billion to 鈧�126听billion) mainly on account of larger imports of research and development services. 滨苍听primary income,a larger deficit was recorded vis-脿-vis the听United States听(up from 鈧�41听billion to 鈧�89听billion), while the听primary income听balance vis-脿-vis the听United Kingdom听switched from a surplus of 鈧�22听billion to a deficit of 鈧�11听billion. 滨苍听secondary income, the deficit vis-脿-vis the听EU Member States and EU institutions outside the euro area听decreased from 鈧�90听billion to 鈧�86听billion.
International investment position
At the end of听the fourth quarter of 2022,听the听international investment position听of the euro area recorded net assets of 鈧�265听billion vis-脿-vis the rest of the world (2.0% of euro area GDP), down from 鈧�475听billion in the previous quarter (Chart听2 and Table听2).
The 鈧�210 billion decrease in net assets reflected changes in the various investment components. Larger net liabilities were recorded in听portfolio equity听(up from 鈧�2.73听trillion to 鈧�2.97听trillion) and in听other investment听(up from 鈧�1.26听trillion to 鈧�1.42听trillion), while lower net assets were recorded in听direct investment听(down from 鈧�2.20听trillion to 鈧�2.18听trillion). These were partly offset by an increase in net assets in听portfolio debt听(up from 鈧�1.14听trillion to 鈧�1.35听trillion).
The developments in the euro area’s net international investment position in the fourth quarter of 2022 were driven mainly by large negative net flows from exchange rate changes 鈥� reflecting the appreciation of the euro in nominal effective terms 鈥� and, to a lesser extent, price changes. These were partly offset by other volume changes and transactions (Table 2 and Chart 3).
Theincrease in net liabilities for听portfolio equity听was mostly driven by negative net flows for price changes (as the price increase was larger in liabilities than in assets), transactions and, to a lesser extent, exchange rate changes, which were partially offset by positive net听other volume changes听(Table 2). The increase in net assets for听portfolio debt听resulted from positive net transactions, other volume changes and price changes, which were partially offset by negative net exchange rate changes. 滨苍听direct investment, negative net flows owing to exchange rate changes were almost offset by positive net price changes, other volume changes and transactions, while in听other investment听net liabilities increased, mainly as a result of negative other volume changes.
At the end of the fourth quarter of 2022 the听gross external debt听of the euro area amounted to 鈧�15.8听trillion (approximately 118% of euro area GDP), down by 鈧�806听billion compared with the previous quarter.
This release provides an overview of the euro area’s international investment position vis-脿-vis residents of听Russia听at the end of the fourth quarter of 2022 and reports the main changes compared with the previous quarter (Table 3).[1]听Euro area financial assets vis-脿-vis听Russia听amounted to 鈧�308听billion (0.9% of euro area external assets) at the end of the fourth quarter of 2022, a 21% decrease since the end of the previous quarter. This decrease was broad-based across functional categories, with the largest contributions due to euro area听direct investment,听other investment听补苍诲听portfolio investment听assets in听Russia. At the same time, the euro area recorded liabilities of 鈧�469听billion vis-脿-vis听Russia听(1.4% of total external liabilities), a decline of 7% compared with the previous quarter, driven mainly by lower liabilities in听other investment.
At the end of 2022 euro area听direct investment assets听were 鈧�12.1 trillion, 26% of which was invested in the听United States听and 18% in the听United Kingdom听(see Table 4). Euro area听direct investment liabilities听were 鈧�9.9 trillion, with 30% being investments from the听United States, 18% from the听United Kingdom听and 18% from听offshore centres.
滨苍听portfolio investment, euro area holdings of foreign securities amounted to 鈧�5.4 trillion in equity and 鈧�5.7 trillion in debt at the end of 2022. The largest holdings of听equity听securities were in securities issued by residents of the听United States听(accounting for 51%), followed by those issued by residents of the听United Kingdom听补苍诲听offshore centres听(each accounting for 10%). 滨苍听debt securities, the largest euro area holdings were in securities issued by residents of the听United States听(accounting for 35%), the听United Kingdom听(18%) and the听EU Member States and EU institutions outside the euro area听(15%).
On the听portfolio investment听liabilities side, non-residents’ holdings of securities issued by euro area residents stood at 鈧�8.3 trillion in equity and at 鈧�4.4 trillion in debt at the end of 2022. The largest holder countries of euro area equity securities were the听United States听(41%) and the听United Kingdom听(10%), while in euro area debt securities the largest holders were the听BRIC听group of countries听(18%), the听United States听(16%) and听Japan听(12%).
滨苍听other investment, euro area residents’ claims on non-residents amounted to 鈧�6.6 trillion, 30% of which was vis-脿-vis the听United Kingdom听and 21% vis-脿-vis the听United States. Euro area听other investment听liabilities amounted to 鈧�8.0 trillion, with the听United Kingdom听accounting for 28%, while the shares of the听EU Member States and EU institutions outside the euro area听and the听United States听were 21% and 15% respectively.
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