Estonia June trade deficit narrows

Estonia's trade deficit shrank from a year ago in June, a report by Statistics Estonia said Monday. This was mainly due to a slower fall in exports compared with imports. However, the trade gap widened from the previous month.

The trade deficit of this Baltic country narrowed to EEK (Estonian kroons) 3.5 billion in June from EEK 4.2 billion from the same period last year. This represented a decline of 15% from last year. In May, the deficit totaled EEK 2.9 billion, which was the smallest deficit since February 2006. Exports fell 1% in June, same as the fall in May. Total exports were valued at EEK 10.7 billion, down from EEK 11.7 billion in May. Total imports declined 5% in the month, compared with a 10% fall in the preceding month. Imports were valued EEK 14.3 billion, down from EEK 4.3 billion in May. Among the commodity groups, exports of machinery and transport equipment rose 5% to EEK 2.4 billion. This category had the highest share in total exports. And, exports of metal products rose 33% to EEK 1.6 billion. Exports increased 11% for agricultural products, 17% for raw materials and products of the chemical industry, and 24% for other items. However, exports of mineral products, the third most important item in the category, declined 27% in June. Exports also fell in double digits for wood and wood products, paper and related articles, textile products, transport equipment, and miscellaneous manufactured articles. Among the trading partners, exports to EU countries comprised 73% of the total exports. Exports to EU rose 5% to EEK 7.8 billion. Exports to the CIS countries, with a share of 13%, rose 28% to EEK 1.4 billion. Within import of goods, those of mineral products and raw materials from the chemical industry increased 16% each, while that of agricultural products was up 15%. On the other hand, import of machinery and equipment, the main imported item, fell 5% to EEK 3 billion. Imports of transport equipment and metals, the second largest category of imports, fell 28% and 6% respectively. Import of wood products was down 43%. Import of most other commodities declined in the month. Among the trading nations, imports from the EU, comprised 82% of all imports. Those from this region fell 1% to EEK 11.6 billion. Imports from the CIS countries, with a share of 11%, fell 25% to EEK 1.5 billion. It is widely viewed that the Estonian economy is in recession. In a report published last month, the statistical office said the Baltic economy posted a negative economic growth of 1.4% in the second quarter, which was the first annual decline since the third quarter of 1999, when the economy shrunk 1%. Analysts with Danske Bank had said the latest data showed that the Estonian economy was clearly sliding into recession, with the bank projecting the negative growth of 1% for this year, with the possibility of some rebound next year. Moreover, the International Monetary Fund warned in May that the Estonian economy was undergoing its first significant slowdown in nearly ten years and that growth for this year as a whole could be negative. Copyright(c) 2008 RealTimeTraders.com, Inc. All Rights Reserved