The surplus of Ukraine’s consolidated balance of payment in April 2020 reached $716 million, while in April 2019 the deficit was $46 million, according to preliminary data posted by the National Bank of Ukraine (NBU) on Friday.
According to the report, the surplus of the current account of the balance of payment last month was $1.4 billion, and in April 2019 the deficit was $92 million.
The volume of exports of goods in April 2020 decreased by 4% (in March 2020 by 3.5%), to $3.6 billion. The decline was due to a decrease in the export of wood and wood products by 19.6% (by 11.7%), ferrous and non-ferrous metals – by 18.1% (by 13.1%) and engineering products – by 8.3% (by 13.3%), as well as a drop in exports of industrial products and chemical products by 24.2% and 2.5% respectively, which a month earlier had increased by 2.3% and 16.7%.
At the same time, in April, export of food products continued to grow – by 6.6% (by 2.3%) and mineral products – by 12.1% (by 3.5%).
In January-April 2020, exports to Asian countries increased in money terms (by $796 million, or 16.9%), while exports to the EU and the Russian Federation decreased by $555 million (9.7%) and $111 million (13.6%) respectively. Thus, the share of exports to Asian countries of total exports increased to 37% (from 31.3% for the same period in 2019), and to the EU and Russia decreased to 34.6% (from 38%) and to 4.7% (from 5.4%).
In April 2020, import of goods decreased more significantly – by 28.4% (in March – by 6%), to $3.4 billion, including energy imports decreased by 33.4% (in March – by 11.5%), and non-energy – by 28.6% (in March – by 4.8%).
Last month, in particular, imports of engineering products decreased by 28.7% (in March – by 2.6%), including cars by 33.4% (in March, it increased by 21.7%). In addition, exports of ferrous and non-ferrous metals decreased by 36.8% (in March – by 8.6%), industrial products by 23% (by 7.2%) and chemical products – by 17.5% (in March it grew by 2.1%).
At the same time, food imports continued to grow – by 2.1% after rapid growth in March by 20.9%.
According to the results of January-April 2020, imports from Russia (by $924 million, or 37.5%) and from the EU countries (by $314 million, or 4.5%) decreased the most in money terms, while Russia’s share of total imports decreased to 9.2% (from 13.2% according to the results of the corresponding period of 2019), and the EU increased to 40.8% (from 38.2%). At the same time, imports from Asian countries remained almost unchanged – it grew only by $34 million (or 0.8%), and its share of total imports – to 26.3% from 23.3%.
According to the report, the surplus in trade in services in April 2020 tripled to $555 million compared to April 2019, thanks to the higher rate of decline in imports of services (by half) compared to their exports (by 17.0%) due to the COVID-19 pandemic.
A decrease in imports of services occurred along with a 72.2% decrease in expenses of people traveling abroad and short-term migrants, as well as a decrease in transport and other business services by 31.3% and 41.2%, respectively.
At the same time, a decrease in the export of services was facilitated by a decrease in transport services (37.5%) and expenses of people traveling in Ukraine (95.7%), while the export of computer services continued to increase (by 21.3%).
According to the central bank, the surplus in the balance of primary income in April 2020 decreased by 10.4%, to $420 million compared to April a year earlier due to the predominance of a decrease in receipts from payroll (by $158 million) over payments on income from investments (by $120 million).
Net borrowing from the outside world (total current account balance and capital account) last month amounted to $1.4 billion, which is 93.4% less than in April 2019 ($91 million).
The surplus of Ukraine’s foreign trade in services in the first quarter of 2020 decreased by 2.9% compared to the same period in 2019, to $1.446 billion against $1.489 billion respectively, the State Statistics Service has reported.
According to its data, export of services in January-March 2020 decreased by 1.8%, to $2.825 billion, imports by 0.7%, to $1.379 billion.
The ratio of coverage of import by export amounted to 2.05 (in the first quarter of 2019 some 2.07).
Foreign trade operations were carried out with partners from 206 countries of the world.
Top 20 countries Ukraine has posted the highest surplus of trade in goods in Jan-Sept 2019
The surplus of Ukraine’s foreign trade in services in January-June 2019 increased by 13.3% compared with January-June 2018, to $2.937 billion ($2.593 billion in H1 2018), the State Statistics Service has reported. Exports of services in January-June 2019 grew by 7.6%, to $5.897 billion, while imports of services rose by 2.5%, to $2.96 billion.
The ratio of coverage of imports by exports was 1.99 in January-June 2019 (1.9 in H1 2018).
Foreign trade operations in the service sector were carried out with partners from 226 countries.
Ukraine saw a $1.2 billion surplus of a consolidated balance of payments in June 2019 compared with a $750 million deficit in May, a $45 million deficit in April, a $652 million surplus in March 2019 and a $23 million surplus in June 2018.
“The surplus of the consolidated balance of payments amounted to $1.2 billion (it was $23 million in June 2018). This allowed us to simultaneously increase international reserves (by $1.1 billion) and pay off debt to the International Monetary Fund ($158 million),” the central bank said in a statement on its website.
The surplus of Ukraine’s balance of payment in 2018 grew by 12.1% compared with the previous year, to $2.88 billion, according to preliminary data published by the National Bank of Ukraine (NBU). “The surplus of the balance of payments is recorded for the fourth year in a row. In particular, last year, primarily it was thanks to a significant inflow of capital in a financial account: obtaining official funding from international partners and borrowing on foreign markets,” the regulator said in a press release.
According to the NBU, in 2018, the current account deficit increased to $4.65 billion from $2.44 billion a year earlier due to the widening deficit of trade with goods. The favorable foreign economic situation for most of the year and the high harvest of grains and oilseeds in 2018 supported export growth, but the complication of transportation in the Sea of Azov and repairs at some enterprises held back its growth, the regulator said.
The NBU said that strong domestic demand and high energy prices have led to a high growth rate of imports of goods compared with exports.
According to the NBU, in 2018, exports of goods grew by 9.2%, to $43.34 billion, while imports by 14.0%, to $56.3 billion.
The central bank said that the sale of food products abroad increased by 4.8%, primarily thanks to an increase in sales of grain crops by 11.4% in monetary terms.
In addition, exports of ferrous and non-ferrous metals grew by 15.3% thanks to favorable pricing conditions.
The largest increase in exports, as the central bank said, occurred in the EU countries – by 15.5%, as a result of which the share of EU countries of total exports of goods increased to 37.6% from 35.6% in 2017. At the same time, the share of Asian countries decreased from 32.4% to 31.5% and Russia’s – to 7.0% from 8.5%.
As for imports, energy imports increased by 15.0%, primarily due to higher global energy prices, the NBU said.
The regulator said that non-energy imports grew by 13.7%, in particular, under the influence of strong domestic demand, imports of engineering products continued to grow at a high rate – by 17.8%, food and industrial goods – by 17.6% and 21%, respectively.
Last year, most of all, imports of goods from Asian countries increased – by 27.3%, as a result, their share increased to 22.4% from 20.1% in 2017. At the same time, despite the increase in imports from EU countries (by 12.4%), their share decreased to 36.6% from 37.2%. Russia’s share also declined – to 14.2% from 14.5%.
The National Bank links the growth of services exports over the past year by 10.6%, to $15.67 billion, primarily, with an increase in exports of services of the IT sector, processing of raw materials supplied by customers and the provision of services in the field of tourism. Imports of services increased 8.0%, to $14.2 billion thanks to an increase in the costs of Ukrainians going abroad and the increased demand for transport and other business services.
The National Bank estimated remittances to Ukraine from Ukrainians working abroad over the past year at $11.33 billion, which is 24.3% higher than the 2017 figure.
At the same time, nonresidents in 2018 withdrew revenues from previously invested funds in the amount of $8.54 billion from Ukraine, exceeding the similar volume of the previous year by 27%. Reverse flow amounted to $0.37 billion, or 90% more than in 2017.
According to the NBU, the net capital inflow on the financial account rose to $7.49 billion, which is almost 1.5 times higher than the 2017 figure. In general, at the end of the year, the inflow in the private sector prevailed, but at the end of the year, with the unblocking of cooperation with the IMF, the role of the public sector increased significantly. In particular, in the fourth quarter, the government placed $2 billion in eurobonds and attracted financing from the World Bank and the EU totaling $1 billion.
Net inflows of foreign direct investment (FDI) to Ukraine, according to NBU estimates, amounted to $2.36 billion in 2018, which is less than in 2017 ($2.59 billion). More than half of FDI – 58% – were sent to the real economy, while investment in the financial sector accounted for 42% of the total volume, almost half of them were banking sector operations for re-issuing debt into charter capital.
The NBU said that thanks to the surplus of the consolidated balance of payments and obtaining an IMF loan, Ukraine’s international reserves increased by 10.7% over the past year, to $20.8 billion or 3.4 months of Current External Payments (CXP) at the end of 2018.