Philippines' balance of payment posts surplus of 8 mln USD in July
Source: Xinhua | 2020-09-05
The Philippines' overall balance of payments (BOP) continued to post a surplus at 8 million U.S. dollars in July, bringing the year-to-date surplus to 4.12 billion U.S. dollars, the Philippine central bank said on Friday.
"The BOP surplus in July 2020 reflected mainly the inflows from the national government's foreign loan proceeds that were deposited with the BSP as well as the BSP's income from its investments abroad," the Bangko Sentral ng Pilipinas (BSP) said in a statement.
"These inflows were offset, however, by the foreign currency withdrawals made by the national government to pay its foreign currency debt obligations during the month in review," the BSP added.
Notwithstanding, the central bank said the continued expansion in the country's overall external position, cumulative BOP surplus was lower than the 5.04-billion-U.S. dollar surplus recorded for the same period a year ago.
The BSP said the current overall BOP surplus was supported mainly by foreign borrowings of the national government, the bulk of which were drawn in April up to July, and the lower merchandise trade deficit.
"These positive outcomes negated fully the impact of higher net outflows of foreign portfolio investments, and lower net inflows from foreign direct investments, trade in services, and personal remittances," the BSP said.
According to the bank, the BOP position reflects a record high final gross international reserves (GIR) level of 98.6 billion U.S. dollars as of end-July 2020.
At this level, the BSP said the GIR represents an ample external liquidity buffer, which can cushion the domestic economy against external shocks.
"This is equivalent to 8.9 months' worth of imports of goods and payments of services and primary income," the BSP said.
Moreover, the BSP said it is also about 7.6 times the country's short-term external debt based on original maturity and 4.9 times based on residual maturity.
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