• The surplus on the current account of the Estonian balance of payments was 241 million euros in the third quarter of 2017, or 4.2% of GDP, which was 50 million euros less than at the same time a year earlier. The surplus was due to the record positive balance on the services account as exports of services exceeded imports of them. At the same time the deficit in goods widened. The capital account showed the volume of investment grants was around double what it was in the third quarter of 2016 at 95 million euros
• The net outflow of capital shown in the financial account¹ was 163 million euros, which was mainly caused by investments by pension funds and the general government in foreign debt securities
• The international investment position showed that at the end of the third quarter the external liabilities of Estonian residents exceeded their external assets by 7.5 billion euros, or 33% of GDP, and the investment position was moving towards balance for the sixth consecutive quarter
• The debt claims of Estonian residents on non-residents were 2.7 billion euros larger than the debt liabilities to them, and were equal to 12% of GDP. The volume of debt assets grew by 412 million euros in the quarter, and the volume of debt liabilities by 142 million

The current account of the Estonian balance of payments was in surplus by 241 million euros in the third quarter of 2017. This was again due to growth in the surplus on the services account and a net inflow of secondary income, including external aid. The surplus in services was 567 million euros, which was around 9% more than in the same quarter of 2016. The surplus was increased primarily by computer services and construction services and passenger transport by air. The goods deficit increased by 83% over the year to 246 million euros. It grew mainly because of a drop in exports of electrical equipment and net exports of goods under merchanting, and a rise in imports of transport equipment. Exports of goods were 3% higher than in the third quarter of 2016, but imports were up 7%. The surplus on the capital account was 49 million euros, which was the same as a year earlier. Almost twice as much was received in investment grants as in the third quarter of 2016. The capital account surplus was reduced to a large extent though by purchases of emissions quotas.

The net total of the current and capital accounts, or net lending (+) or borrowing (-), was positive by 291 million euros in the third quarter of 2017. This meant that the Estonian economy was a net lender to other countries, so the country as a whole invested more financial assets abroad than it received from there.

The financial account of the balance of payments shows that investment abroad from Estonia was 163 million euros larger than investment in Estonia from abroad. The net capital outflow was primarily a consequence of investments in foreign securities by pension funds and the general government. The net outflow of investment through the banking system, which means credit institutions and Eesti Pank, was 672 million euros. This was because of structural changes at credit institutions that reduced their liabilities to their parent banks. At the same time, companies replaced their loan liabilities to resident credit institutions with liabilities to foreign credit institutions. The inflow of direct investment exceeded the outflow, as it had in the second quarter. The inflow of investment increased because of investments in equity by credit institutions and because non-financial companies reinvested the profits they had earned in Estonia.

The net international investment position at the end of the third quarter of 2017 showed that the external liabilities of Estonian residents exceeded their external assets by 7.5 billion euros, or 33% of GDP. During the quarter the investment position moved in the direction of net balance by 68 million euros.

Statistics for the external debt show that at the end of the quarter, the debt claims of Estonian residents on non-residents were larger than their debt liabilities by 2.7 billion euros, or 12% of GDP. Both debt assets and debt liabilities increased during the quarter.

For more detail on the financial account, the international investment position and the external debt see the external sector statistics.

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¹ Net flow is inflow minus outflow. If the inflow exceeds the outflow, there is a net inflow, if the outflow exceeds the inflow there is a net outflow.

Eesti Pank will release the preliminary statistics for the balance of payments, the international investment position and the external debt for the whole year 2017 together with an economic policy and statistical release on 8 March 2018 at 08.00.

Background Information

Eesti Pank accompanies the release of statistics on the balance of payments, the international investment position and the external debt with a separate statistical release and an economic policy explanation.

The statistical release on the balance of payments describes the main changes in the balance of payments, the international investment position and the external debt. The release is independent of economic policy releases and is presented separately from them.

Additional information:
Andres Lauba
Eesti Pank Statistics Department
Telephone: 668 0725
Email: [email protected]