Monthly developments in December 2000 and preliminary overall results for 2000

Looking at 2000 as a whole, the current account deficit amounted to EUR 28.3 billion, as compared with a deficit of EUR 5.8 billion in 1999. The main factor behind the increasing current account deficit was a marked decrease in the goods surplus - from EUR 83.4 billion in 1999 to EUR 59.8 billion in 2000 - and, to a lesser extent, small increases in the deficits on services and current transfers (by EUR 1.7 billion and EUR 4.9 billion, respectively), whereas the income deficit decreased by EUR 7.7 billion. The sharp fall in the goods surplus resulted from the value of imports growing faster than the value of exports (by 25.1% compared with 19.6%). The increase in export values was due mainly to rising export volumes owing to robust foreign demand, whereas the increase in import values was mainly driven by a strong increase in import prices as a result of the rise in oil prices and the depreciation of the euro. The gap between the growth rates of imports and exports narrowed in the second half of 2000. Net outflows of EUR 33.4 billion in direct investment in December 2000 reflected net direct investment abroad of EUR 22.3 billion, close to the levels in the other months in the fourth quarter of 2000, and net disinvestment of EUR 11.1 billion by foreign investors. Flows within this account were significantly influenced by the legal restructuring of one multinational firm. Elsewhere in the financial account, net outflows in financial derivatives amounted to EUR 4.9 billion in December 2000. Net inflows in other investment amounted to EUR 1.0 billion. Reserve assets decreased by EUR 2.4 billion in December 2000 (excluding valuation effects). Errors and omissions amounted to EUR 16.3 billion in December 2000, and to EUR 17.1 billion in 2000 as a whole.

In December 2000 the current account deficit increased by EUR 0.9 billion, as compared with the same month in 1999, to EUR 4.8 billion. This was due to an increase in the deficit on services (by EUR 1.4 billion), a small decline in the goods surplus (by EUR 0.3 billion), and a small increase in the deficit on current transfers (by EUR 0.2 billion), which more than offset the decrease in the income deficit (by EUR 1.0 billion). In the financial account, the main development in December 2000 was a significant net outflow in direct investment, while portfolio investment reported its second highest net inflow in 2000. The high level of net portfolio investment inflows in December 2000 (EUR 22.4 billion) was mainly related to the combination of net inflows in debt instruments (EUR 17.5 billion) and in equities (EUR 4.9 billion). In particular, euro area residents actually repatriated investment in foreign bonds and notes (EUR 3.2 billion) in December 2000, in contrast to net investment abroad in all other months of 2000. Net inflows in portfolio equity were related to an exceptionally high level of investment by non residents in euro area equity securities (EUR 30.2 billion), in connection with the settlement of direct investment transactions in shares. Looking at 2000 as a whole, combined net direct and portfolio investment outflows were somewhat lower (EUR 143.4 billion) than in 1999 (EUR 162.3 billion). In 2000 the balance for bonds and notes turned to net inflows (EUR 123.6 billion) - in contrast to net outflows of EUR 44.6 billion in 1999. Moreover, net direct investment outflows declined to EUR 23.0 billion in 2000, from EUR 120.6 billion in 1999. This more than offset the substantial rise in net outflows for portfolio equity transactions (from EUR 49.4 billion in 1999 to EUR 266.0 billion in 2000) and a decline of EUR 30.3 billion in net inflows in money market instruments.

Annex 1 The results for November 2000 will also be published in the February 2001 issue of the

to this press release contains statistics produced by the Eurosystem for the monthly balance of payments (b.o.p.) of the euro area for 1999 and 2000.

ECB Monthly Bulletin The European Central Bank and the European Commission (Eurostat) simultaneously disseminate press releases on the quarterly balance of payments for the euro area and the EU15. In line with the agreed allocation of responsibility, the European Central Bank is in charge of compiling and disseminating the euro area monthly and quarterly balance of payments statistics, whereas the European Commission (Eurostat) focuses on quarterly and annual aggregates of the EU15 ( 

. A detailed methodological note on euro area b.o.p. statistics is available on the ECB's website.

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 ). The data comply with international standards, in particular those set out in the IMF Manual on Balance of Payments Statistics (5th edition). The aggregates for the euro area and the EU15 are compiled consistently on the basis of Member States' transactions with residents of countries outside the euro area and the European Union respectively. Reproduction is permitted provided that the source is acknowledged