Ukraine swings to balance of payments surplus of $6.8 bln in Jan-May from deficit a year earlier
MOSCOW. July 4 (Interfax) - Ukraine's balance of payments surplus grew to $1.53 billion in May from $1.4 billion in April, Ukrainian media reported, citing the National Bank of Ukraine (NBU).
The growth was due to a net inflow into the financial account of $1.55 billion compared to $1 billion a month earlier amid a small current account deficit of $21 million, while in April there was a surplus of $380 million.
There was a balance of payments surplus of $6.82 billion in the first five months of 2023, compared to a deficit of $6.04 billion in the same period of last year, also thanks to a net inflow of $8.17 billion into the financial account, compared to an outflow of $9.18 billion a year earlier.
The NBU reported on its website that there was a visible and invisible trade deficit of $2.53 billion in May, as considerable spending by Ukrainian citizens abroad was offset by the receipt of a grant from international partners, which increased the surplus of secondary incomes.
Ukraine had a current account deficit of $1.43 billion in the first five months of 2023 (not including reinvested income and grants from international partners in the amount of $6.3 billion), compared to a surplus of $3.07 billion in the same period of 2022.
Visible exports rose 10% year-on-year to $2.9 billion in May and imports grew by 28.2% to $4.9 billion, but compared to the previous month, visible exports slumped 0.2% while imports rose 6.7%.
The strongest growth in exports in May was to Asia, exports to which jumped 130% and grew to 23.7% of the total from 11.3% in May 2022. Exports to the European Union, meanwhile, fell 13.9% and their share of the total shrank to 59.7% from 76.3%. Imports from Asia surged 70% and their share grew to 34.4% of the total from 25.6%.
The NBU said food exports grew by 38.9% year-on-year in May, including 120% for grain, but fell 3.3% and 12.8%, respectively, from the previous month. Exports of other commodities fell, including by 45.1% year-on-year and 7% month-on-month for mineral products (including ore) and 24% and 23.8%, respectively, for engineering products.
Energy imports decreased by 7.1% year-on-year and 10.8% from the previous month in May, while non-energy imports grew by 36.2% and 10.0%, respectively. Imports were up 31.4% year-on-year and 1% month-on-month for engineering products; up 50% and down 5.6%, respectively, for chemical products; up 110% and 23.4% for ferrous and nonferrous metals; and up 20% and 1.9% for food products.
The invisible trade deficit shrank to $501 million in May from $591 million in the previous month and $1.13 billion a year earlier. Exports of services grew by 12.1% year-on-year, while imports fell 19.9%.
The primary income deficit shrank to $529 million in May from $724 million in the previous month and $754 million a year earlier due to an 8.9% drop in compensation of employees and 70% increase in payments on investment income.
The secondary income surplus was little changed month-on-month at $2 billion in May, but up from $1.4 billion a year earlier, primarily due to large amounts of financing through grants from international partners.
Net external borrowing (combined current account balance and capital account balance) totaled $12 million in May, down from $170 million a year earlier, while in April 2023 there was net lending in the amount of $402 million.
In the first five months of 2023, net external borrowing totaled $1.35 billion, while in the same period of 2022 there was net lending of $3.13 billion.
The net inflow on state sector transactions grew to $1.93 billion in May from $.58 billion a month earlier and $0.94 billion a year earlier due to a net inflow of $1.9 billion on loans from international partners.
Net foreign director investment totaled $140 million in May, down from $299 million a month earlier but up from $80 million a year earlier, the NBU estimated. In the first five months of 2023, the net inflow of FDI totaled $1.6 billion, while a year earlier there was a net outflow of $465 million.