Home > Statistics > Balance of payments and international investment position > 2016 > October > Current account in balance in the third quarter, net capital inflow to Finland

Published: 15 December 2016

Current account in balance in the third quarter, net capital inflow to Finland

The current account was in balance in the third quarter of 2016. The value of exports of goods and services decreased. In October, the decline continued as the value of exports of goods and services decreased by four per cent. In the third quarter of 2016, net capital inflow to Finland amounted to EUR 4.3 billion. The net international investment position was positive. The data appear from Statistics Finland's statistics on balance of payments and international investment position.

Current account and trade account

Current account in the third quarter

The current account was in balance in the third quarter, while one year earlier, the current account showed a surplus of EUR 0.8 billion.

In balance of payment terms, the trade account was EUR 0.1 billion in surplus. The value of exports of goods in balance of payment terms declined by two per cent from the corresponding period one year ago and amounted to EUR 13.0 billion. The value of imports of goods in balance of payment terms declined by one per cent from the corresponding period one year ago to EUR 12.9 billion.

The service account showed a deficit of EUR 0.6 billion, whereas in the third quarter of 2015, the service account was in balance. The weakening of the service account was due to both the fall in service exports and the rise in service imports. As the value of service exports fell by five per cent to EUR 5.3 billion, service imports rose by four per cent from the third quarter of 2015.

The primary income account was EUR 0.8 billion in surplus. The primary income account includes investment income like interests and dividends. The secondary income account was EUR 0.4 billion in deficit.

Export and import figures in balance of payments terms by service item and area can be found in the statistics on international trade in goods and services .

Current account in October

In October, the current account was EUR 0.3 billion in surplus. Of the sub-items of the current account, the primary income account was in surplus and the service account and the secondary income account were in deficit. In balance of payment terms, the goods account was in balance. The value of exports of goods in balance of payment terms decreased by six per cent from twelve months back. The value of imports of goods in balance of payment terms declined by two per cent from twelve months back.

Current account and trade account, 12 –month moving sum

Financial account and net international investment position

Capital flowed to Finland in the third quarter of 2016

In the third quarter of 2016, net capital inflow to Finland amounted to EUR 4.3 billion. Capital inflow was mainly in the form of other investments, EUR 8.7 billion. Other investments include external loans, deposits and trade credits, of which capital flowed to Finland particularly as loans.

At the end of September, Finland had EUR 739.3 billion in foreign assets and EUR 733.2 billion in foreign liabilities. Finland's net international investment position fell in the third quarter as a consequence of the decrease in other investment assets and the growth in liabilities. Price changes related to foreign assets and liabilities boosted the net investment position by EUR 0.3 billion. Securities' portfolio investments grew as a result of risen stock market prices. Changes in exchange rates and other valuation changes in turn lowered the net investment position by EUR 1.3 billion.

Examined by sector, the net international investment position of monetary financial institutions went down by EUR 5.0 billion due to the decrease in assets and that of non-financial corporations by 7.4 billion as a result of growing liabilities. The net investment position of employment pension schemes in turn grew by EUR 4.0 billion due to grown assets.

Table 1. External assets and liabilities by investment type, EUR billion

	Opening position 30.06.2016	Financial transactions 2016 Q3	Price changes 2016 Q3	Changes in the exchange rates and valuation adjustments 2016 Q3	Closing position 30.9.2016
Financial account	11.5	-4.3	0.3	-1.3	6.2
Assets	737.7	-19.1	22.9	-2.1	739.3
Liabilities	726.2	-14.8	22.6	-0.8	733.2
Direct investment	32.0	0.1	0.7	–0.1	32.8
Assets	141.8	1.5	1.1	-0.7	143.6
Liabilities	109.8	1.3	0.4	-0.7	110.9
Portfolio investment	-1.8	4.9	-0.8	-1.1	1.2
Assets	292.7	6.5	6.1	–0.8	304.5
Liabilities	294.5	1.6	7.0	0.2	303.3
Other investment	-32.8	-8.7	0.0	0.1	-41.4
Assets	186.1	-5.8	0.0	-0.5	179.7
Liabilities	218.8	2.8	0.0	-0.6	221.1
Financial derivatives	4.1	-0.8	0.4	-0.2	3.6
Reserve assets	10.0	0.1	0.0	-0.1	10.0

Financial account and international investment position in October

In October, the inward capital flow on net to Finland was EUR 1.1 billion. The main source of inward capital flow was other investments, EUR 2.6 billion.

Finland's net investment position was EUR 11.8 billion positive at the end of October, as foreign assets amounted to EUR 731.3 billion and foreign liabilities to EUR 719.6 billion.

The data for November will be published on 13 January 2017.

International investment position monthly

Source: Balance of payments and international investment position, Statistics Finland

Inquiries: Tapio Kuusisto 029 551 3318, Saana Ranta-Ruona 029 551 3375, balanceofpayments@stat.fi.

Director in charge: Ville Vertanen

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Appendix tables

• Appendix table 1. Current account, quarterly 2016, EUR million (15.12.2016)
• Appendix table 2. External assets and liabilities by sector, quarterly 2016, EUR million (15.12.2016)
• Appendix table 3. International investment position by sector, quarterly 2016, EUR million (15.12.2016)
• Appendix table 4. Balance of payments 2016, EUR million (15.12.2016)

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Updated 15.12.2016