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Colombia's current account deficit shrinks to 2.7% of GDP in 3rd quarter

Credit: REUTERS/LUISA GONZALEZ

Colombia's current account deficit shrank to 2.7% of gross domestic product (GDP) in the third quarter, the central bank said on Tuesday, while the figure for the first nine months of the year also decreased.

BOGOTA, Dec 1 (Reuters) - Colombia's current account deficit shrank to 2.7% of gross domestic product (GDP) in the third quarter, the central bank said on Tuesday, while the figure for the first nine months of the year also decreased.

The reduction from the 5.2% current account deficit in the third quarter of 2019 was due to lower capital outflows on profits from foreign investment and a smaller foreign trade deficit, the bank said.

The deficit for the July-September quarter was equivalent to $1.77 billion, less than the $4.16 billion in the same period last year.

Between January and September, the deficit fell to 3.1% of GDP, equivalent to $6.05 billion, from $10.58 billion or 4.4% of GDP in 2019.

The current account of the balance of payments is a broad measure of transactions between the country and the rest of the world. It encompasses trade, interest payments, dividends, remittances and services like tourism.

Part of the smaller deficit can be explained by the fall in global trade and economic activity because of the coronavirus pandemic, the bank said.

Foreign direct investment in the first nine months of the year fell 49.7% to $5.45 billion, compared with the year-earlier period.

(Reporting by Nelson Bocanegra; Writing by Julia Symmes Cobb; Editing by Peter Cooney)

((Julia Symmes Cobb julia.cobb@thomsonreuters.com))

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