BoP surplus at 7-yr high in 2019
Credit to Author: Mayvelin U. Caraballo, TMT| Date: Mon, 20 Jan 2020 16:22:27 +0000
THE Philippines’ balance of payments (BoP) surplus hit an 11-month high in December, boosting the full-year 2019 tally to reach its highest in seven years.
The Bangko Sentral ng Pilipinas (BSP) reported on Monday that the $1.57-billion surplus in December was higher than the $541-million surplus in November, but lower than the $2.44 billion recorded a year ago.
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It was also the largest since January 2019, when the payments position stood at a surplus of $2.70 billion.
“Inflows in December 2019 reflected the BSP’s net foreign exchange purchases from its foreign exchange operations and income from its investments abroad, and increase in the national government’s (NG) net foreign currency deposits,” the central bank said in a statement.
These were partially offset by “outflows representing payments made by the NG on its foreign exchange obligations during the month in review,” it added.
This resulted in a full-year 2019 payments balance surplus of $7.84 billion, a reversal of the $2.30 billion recorded in 2018.
It also surpassed the central bank’s $4.8-billion surplus forecast for 2019, and was also the highest since the $9.23 billion surplus in 2012.
“Based on preliminary data, the surplus was supported by higher net receipts of trade in services, personal remittance inflows from overseas Filipinos, and sustained net inflows of foreign direct investments (FDI) and portfolio investments,” the BSP said.
Personal remittances reached $30.25 billion in January to November 2019, up by 4.1 percent from $29.05 billion in the same period in 2018.
Meanwhile, net FDI reached $5.79 billion in the first 10 months of 2019, 32.8-percent down from the amount in January to October 2018.
Foreign investment portfolios, on the other hand, registered a net outflow of $1.90 billion in full-year 2019.
Last year’s payments balance position, meanwhile, is consistent with the country’s final gross international reserves (GIR) of $87.84 billion as of end-December 2019.
“At this level, the GIR represents a more-than-ample liquidity buffer equivalent to 7.7 months’ worth of imports of goods and payments of services and primary income,” the BSP said.
The GIR is also equivalent to 5.5 times the country’s short-term external debt based on original maturity and 4.3 times based on residual maturity, it added.