MNB: Hungary net external financing capacity reaches record €10 bln
Image by Jessica Fejos
Hungaryʼs net external financing capacity, calculated as the sum of current and capital accounts, reached €10.1 billion, a new record, in 2015, Hungarian news agency MTI calculated based on December balance of payment data published by the National Bank of Hungary (MNB) yesterday.
Net external financing capacity was €628 million in December alone, albeit half the amount of November. The fourth-quarter net external financing capacity was still €2.6 bln, close to the quarterly record reached in Q3.
The monthly figures offer the first look at Q4 and 2015 balance of payment developments before the MNB publishes the official first reading of quarterly data for Q4 on March 24.
Net transfers from the European Union increased to a record €6.7 bln last year and shed light on about two-thirds of the yearʼs financing surplus, the December data imply. The transfersʼ share of the surplus fell from 88% in 2014.
Given that the payment statistics are accrual-based, reflecting the utilization of EU funds, they were not affected by a five-month suspension of transfers last year. Brussels suspended the transfers due to problems it had with the project selection process in Hungary.
Yesterdayʼs figures imply that Hungaryʼs net financing capacity widened by €3.9 bln or more than 60% last year and well surpassed the previous annual peak of €7.6 bln, reached in 2013.
The bulk of the 2015 increase manifested itself in the current account, where the surplus widened by €3.1 bln, mainly reflecting a sharp rise of the surplus on goods, to €5.4 bln. The capital account surplus increased €800 mln to €4.7 bln.
The December developments were affected mainly by net EU transfer utilization that dropped sharply in December, to a little over €350 mln from an outstanding €1.1 bln in November. December was the last month during which EU funds available for the 2007-2013 EU budgetary period could be used.
Net EU fund transfers reached €2 bln in Q4, exceeding amounts in all of the previous three quarters but below the utilization in the last quarters of both 2013 and 2014. Full-year net EU funding utilization still rose €1.2 bln from the previous record years of 2013 and 2014, to a preliminary €6.7 bln.
Within net EU transfers, capital transfers dropped €218 mln in December, to a little more than one quarter of the November peak. Despite the slowdown, the 2015 total reached a record high of €4.8 bln.
The MNB began releasing monthly balance of payments reports in July 2014. The data comprise estimates that may be revised later.
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