The country’s overall balance of payments (BOP) position posted a surplus of US$3.1 billion in January 2023, a reversal from the US$102 million BOP deficit recorded in the same month last year.
The BOP surplus in January 2023 reflected inflows arising mainly from the National Government’s (NG) net foreign currency deposits with the Bangko Sentral ng Pilipinas (BSP), which include proceeds from its issuance of ROP Global Bonds, and net income from the BSP’s investments abroad.
The BOP position reflects an increase in the final gross international reserves (GIR) level to US$100.7 billion as of end-January 2023 from US$96.1 billion as of end-December 2022.
The latest GIR level represents a more than adequate external liquidity buffer equivalent to 7.6 months’ worth of imports of goods and payments of services and primary income.[1]
It is also about 6.2 times the country’s short-term external debt based on original maturity and 4.1 times based on residual maturity. [2]
[1] Specifically, 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.
[2] Short-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.
