Category : Press Release
Date : October 26, 2020
Agency : Bangko Sentral ng Pilipinas
Title : Overall BOP Position Posts US$2.1 Billion Surplus in September 2020; Year-To-Date BOP Surplus at US$6.88 Billion, while GIR Level Rises to US$100.44 Billion
Article : The country’s overall balance of payments (BOP) position posted a surplus of US$2.1 billion in September 2020, bringing the year-to-date surplus position to US$6.88 billion. The BOP surplus in September 2020 reflected mainly the inflows from the BSP’s foreign exchange operations and income from its investments abroad, and the National Government’s (NG) foreign currency deposits with the BSP. These inflows were partly offset, however, by the NG’s payments of its foreign currency debt obligations.

The cumulative BOP surplus of US$6.88 billion was higher than the US$5.57 billion surplus recorded for the same period a year ago. Based on preliminary data, the current BOP surplus was supported mainly by higher net foreign borrowings by the NG and lower merchandise trade deficit along with sustained net inflows from foreign direct investments, personal remittances, and trade in services.1

The BOP position reflects an increase in the final gross international reserves (GIR) level of US$100.44 billion as of end-September 2020 compared with US$98.95 billion as of end-August 2020. At US$100.44 billion, the GIR represents a more than adequate external liquidity buffer, which can cushion the domestic economy against external shocks.2 This is equivalent to 10 months’ worth of imports of goods and payments of services and primary income. Moreover, it is also about 9 times the country’s short-term external debt based on original maturity and 5.4 times based on residual maturity.3


1Based on the International Merchandise Trade Statistics (IMTS) of the Philippines published by the Philippine Statistics Authority (PSA) for January-August 2020, foreign direct investments for January-July 2020, personal remittances from overseas Filipinos for January-August 2020, and trade in services for January-June 2020.
2Specifically, it ensures availability of foreign exchange to meet balance of payments financing needs, such as for payment of imports and debt service, in extreme conditions when there are no export earnings or foreign loans.
3Short-term debt based on residual maturity refers to outstanding external debt with original maturity of one year or less, plus principal payments on medium- and long-term loans of the public and private sectors falling due within the next 12 months.

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