Euro area trade surplus halves as Cyprus records wider trade deficit

Eurostat on Friday reported a decline in the euro area’s trade surplus for February, while earlier data released this month by Cyprus’ statistical service pointed to a widening trade deficit driven by a sharp drop in exports.

The latest figures showed that the euro area trade surplus stood at €11.5 billion in February 2026, marking a significant decline from €23.1 billion in February 2025.

At the same time, euro area exports fell to €232.4 billion in February 2026, representing a decrease of 6.7 per cent compared with €249.1 billion a year earlier.

Meanwhile, imports into the euro area reached €220.9 billion, down by 2.2 per cent from €225.9 billion in February 2025.

Despite the annual decline, the euro area recorded a monthly improvement in trade balance, moving from a deficit of €1.0 billion in January 2026 to a surplus of €11.5 billion in February 2026.

This rebound was largely driven by the machinery and vehicles sector, where the surplus increased sharply from €1.5 billion in January to €10.2 billion in February 2026.

However, compared with February 2025, the overall surplus dropped by €11.6 billion, reflecting mixed sectoral performance across the bloc.

The chemicals sector saw a notable decline, with its surplus falling from €30.4 billion to €16.2 billion year-on-year.

Similarly, the machinery and vehicles sector recorded a reduced surplus compared with the previous year, declining from €14.2 billion to €10.2 billion.

In contrast, the energy sector deficit continued to narrow, improving from €-25.2 billion in February 2025 to €-20.0 billion in February 2026.

Over the first two months of the year, the euro area posted a surplus of €10.6 billion, down from €21.8 billion in the same period of 2025.

Exports during January to February 2026 fell to €447.5 billion, a decrease of 7.2 per cent, while imports declined to €436.9 billion, down by 5.1 per cent.

Intra-euro area trade also weakened, slipping by 1.5 per cent to €432.7 billion, Eurostat added.

Across the wider European Union, the EU trade surplus reached €9.1 billion in February 2026, compared with €22.9 billion a year earlier.

Extra-EU exports dropped to €204.7 billion, marking a sharper decline of 9.3 per cent, while imports fell by 3.5 per cent to €195.7 billion.

The EU shifted from a deficit of €5.6 billion in January 2026 to a surplus in February, again supported by the machinery and vehicles sector, where the surplus rose from €1.8 billion to €11.5 billion.

However, on an annual basis, the EU surplus decreased by €13.8 billion, reflecting declines in both chemicals and industrial sectors.

The chemicals sector surplus fell from €28.7 billion to €14.8 billion, while the machinery and vehicles surplus dropped from €18.9 billion to €11.5 billion.

At the same time, the energy deficit improved from €-27.6 billion to €-22.1 billion.

For January to February 2026, the EU recorded a surplus of €3.5 billion, down from €17.5 billion in the same period of 2025.

Exports fell by 9.5 per cent to €394.4 billion, while imports declined by 6.6 per cent to €390.9 billion.

Intra-EU trade edged down slightly by 0.3 per cent to €676.1 billion, the statistical office reported.

Seasonally adjusted data showed that euro area exports increased by 0.9 per cent in February compared with January, while imports rose by 3.5 per cent, resulting in a reduced balance of €7.0 billion.

Similarly, EU exports rose by 0.2 per cent month-on-month, while imports increased by 3.6 per cent, bringing the balance down to €3.7 billion.

Against this broader European backdrop, Cyprus recorded a sharp deterioration in its trade balance, according to data released by the statistical service.

Total imports of goods in February 2026 reached €1.12 billion, up from €1.06 billion in February 2025, reflecting an increase of 5.6 per cent.

Imports from other EU member states amounted to €675 million, while imports from third countries stood at €440.4 million, compared with €582.7 million and €473.7 million respectively a year earlier.

These figures included the transfer of economic ownership of vessels and aircraft valued at €182.4 million, significantly higher than €8.5 million in February 2025.

At the same time, total exports of goods fell sharply to €244.3 million from €496.2 million, marking a steep decline of 50.8 per cent.

Exports to EU member states reached €93.2 million, while exports to third countries totalled €151.1 million, compared with €126.6 million and €369.6 million respectively in February 2025.

Exports also included vessel transfers worth €10.5 million, down from €97 million a year earlier.

For the period from January to February 2026, total imports stood at €2.11 billion, compared with €2.21 billion in the corresponding period of 2025, representing a decrease of 4.5 per cent.

Total exports reached €766.2 million, down from €939.9 million, reflecting a decline of 18.5 per cent.

As a result, the Cyprus trade deficit widened to €1.34 billion, compared with €1.27 billion in the same period of the previous year.

Final data for January 2026 showed imports at €992.6 million, down from €1.15 billion in January 2025, marking a decrease of 13.8 per cent.

Exports of domestically produced products fell to €257 million from €368.4 million, a decline of 30.2 per cent.

Domestic exports of industrial products stood at €244.9 million, compared with €356.2 million a year earlier.

Domestic exports of agricultural products reached €10.5 million, slightly down from €11.1 million.

By contrast, exports of foreign products surged to €264.9 million from €75.3 million, recording a significant increase of 251.8 per cent.

The main categories of domestic exports included mineral fuels and oils, valued at €144.9 million, followed by pharmaceutical products at €39.2 million and halloumi cheese at €24.4 million.

The statistical service explained that mineral fuels and oils refer to goods that were imported, processed and then re-exported.

It also clarified that January 2026 data were revised, while February 2026 figures remain provisional.