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Slovak trade surplus surprisingly widens in March

Published 05/12/2009, 05:10 AM
Updated 05/12/2009, 05:16 AM

BRATISLAVA, May 12 (Reuters) - Slovakia's foreign trade surplus unexpectedly widened in March, data showed on Tuesday, but this was not seen as a sign of recovery because it was influenced by a sharper fall in imports than exports.

The balance showed a surplus of 81.9 million euro ($111.4 million) in March, after a revised 78.7 million euro surplus in the previous month. Analysts had expected a 25 million euro trade deficit in March [ID:nLC599902].

Exports fell by 20.1 percent on the year in March, while imports were down by 23.1 percent.

"The trade figure is better than expected ... but it is hard to read," said Slovenska Sporitelna senior analysts Maria Valachyova.

"It is not necessarily as positive as it might appear at the first sight, this is not a sign of recovery. Imports fell faster than exports," she said.

Slovakia, a euro zone country since January, has avoided a direct hit from the financial crisis on its banks, but demand in the West for its goods, mainly cars and TV sets, has slumped.

ING Bank analyst Eduard Hagara saw signals that exports were stabilising. "There is no reason to be overly optimistic, one month does not mean that there is a trend, though there are some signs (of improvement)," Hagara said. "The industrial production structure showed the electronics and car sectors have improved, on a seasonally adjusted basis."

Data showed on Monday Slovak industrial output rebounded from record lows in March thanks to a rise in electronics sector, although it was still down on the year [ID:nLB58194].

The central bank expects the 70 billion euro economy to shrink by 2.4 percent this year.

Cooling economic activity has put public finances under pressure and complicated the efforts of leftist Prime Minister Robert Fico to expand welfare programmes. (Reporting by Martin Santa and Peter Laca; Editing by Ruth Pitchford)

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