Greek balance of payments data confirm tourism surge

Reuters

* Current account surplus shrinks to 1.22 bln eur

* Aug tourism revenue up 12.4 pct

ATHENS, Oct 18 (Reuters) - Strong spending by foreignvisitors kept Greece's cumulative current account deficit forthis year falling in August although a corresponding rise inimports pushed its trade shortfall higher.

With domestic demand, investment and industrial output suffering from searing budget cuts, spending by foreign visitors is becoming the only growth driver for the euro zone'sworst performing economy, now in its sixth year of recession andprojected to contract another 4.0 percent this year.

Tourism receipts, the country's biggest foreign-currency earner, rose 12.4 percent year-on-year to 2.84 billion euros inAugust, generating a current account surplus of 1.221 billioneuros ($1.67 billion), down from 1.663 billion euros in the samemonth a year ago.

Greece's annual current account gap ballooned to 15 percent of gross domestic product in 2008, but it is now improving fastand the International Monetary Fund expects it to shrink to 0.8percent of GDP this year.

"The current account adjustment continues at a strong pace,helped by higher tourism revenue and an ongoing compression ofimports," said Eurobank economist Platon Monokroussos.

"I expect the current account deficit to shrink below 1.0percent of GDP in 2013 and record a small surplus next year."

Tourism revenue for the first eight months of this year grew13.7 percent compared with the same period last year to 8.69billion euros. The industry is forecasting a 10 percent rise in tourism receipts for the full year to 11 billion euros, expecting more than 17 million visitors.

Hoteliers, restaurant owners and tourism businesses have slashed prices and upgraded services to weather the crisis and lure more visitors.

A better mix of visitors - including those who stay longer and spend more on average, such as Russian tourists - is also helping.

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