Strong spending by foreign tourists helped Greece’s current account balance turn to a surplus in the first 11 months of last year, putting the battered country on track for its first such surplus since joining the euro over a decade ago.
With domestic demand, investment and industrial output hurt by searing budget cuts, tourism has become the main growth driver for the euro zone’s worst-performing economy, which is expected to recover mildly this year.
Tourism receipts, the country’s biggest foreign-currency earner, slipped 1.5 percent year-on-year to 191 million euros ($261.30 million)in November but total revenue in the 11 months of 2013 grew 15 percent to 11.83 billion euros, helping to generate a current account surplus of 1.46 billion euros.
One of its twin deficits alongside the budget deficit, Greece’s current account gap had ballooned to 15 percent of gross domestic product in 2008 before its debt crisis exploded.
The latest data shows Greece is likely to top the International Monetary Fund projection of a current account deficit of 0.8 percent of national output in 2013, fuelled by a fall in imports.
“The big adjustment in closing the gap has been achieved and we expect the balance to stabilise this year,» said Eurobank economist Nikos Magginas at National Bank.
“Tourism should have another good year and economic recovery may see the decline in imports slow down,» he said.
Athens expects the battered economy will grow by 0.6 percent this year after a six-year contraction which has shrunk it by a quarter.
The tourism industry has forecast a 10 percent rise in tourism receipts for 2013 to 11 billion euros, as hoteliers and restaurant owners cut prices and upgrade services to weather the crisis and lure more visitors.
A broader mix of visitors – including those who stay longer and spend more on average, such as Russian tourists – is also helping.