Cyprus’ current account deficit declined to €346.1 million in the second quarter of this year, compared with €1.04 billion in the corresponding period of last year, preliminary data released by the Central Bank of Cyprus (CBC) show.

According to the CBC, Cyprus current account deficit in the second quarter of this year marked an improvement of 67% compared with the corresponding quarter of last year.

The deficit in terms of goods amounted to €1.61 billion in the second quarter of this year, compared with €1.93 billion in the respective period of last year, showing improvement by 16.3% year on year.

In services, the balance was positive and amounted to €1.90 billion from €1.55 billion in Q2 last year, marking an annual improvement of 22.6%.

According to the CBC, adjusting for the impact of Special Purpose Entities (SPEs), that is, classifying SPEs as non-residents, the deficit stood at €480.7 million in Q2 2023, compared with a deficit of €727.2 million in Q2 2022.

Furthermore, Cyprus’ international investment position (IIP) deteriorated in Q2 2023, presenting a net liability position of €28,658.3 million, compared with a net liability position of €28,265.1 million in Q1 2023.

Adjusting for the impact of SPEs, Cyprus’ IIP recorded a net liability position of €10,710.7 million in Q2 2023, compared with a net liability position of €10,217.5 million in Q1 2023, the CBC added.

The gross external debt decreased marginally to €169,614.3 million in Q2 2023 from €169,618.8 million in Q1 2023.

According to the CBC, the external assets in debt instruments increased to €146,830.5 million, up from €145,614.5 million in Q1 2023. Consequently, the net external debt decreased by €1,220.5 million to €22,783.81 million in Q2 2023.

Adjusted for the impact of SPEs, gross external debt reached €58,513.4 million in Q2 2023, compared to €58, 159.0 million, in Q1 2023.

The corresponding net external debt indicator decreased to -€12,822.1 million in Q2 2023, compared with -€11,569.9 million in Q1 2023, the CBC said.