Bangko Sentral ng Pilipinas. (File photo / Philippine Daily Inquirer)
Settlement of foreign debts at the start of this year swung the Philippines’ balance of payments (BOP) position to a deficit of $102 million in January.
The latest BSP data released on Friday night showed that the January BOP deficit reversed the $991-million surplus in December 2021. But compared to a year ago, last month’s gap was narrower than the $752-million deficit in January 2021.
The BOP deficit, which meant more US dollars left than entered the economy last month, “reflected outflows arising mainly from the national government’s payments of its foreign-currency debt obligations,” the BSP said in a statement.
The deficit also reflected the decline in gross international reserves (GIR) to $107.69 billion in January from $108.79 in end-2021, the BSP said.
While the country’s dollar stash dropped, the BSP said it remained a “more-than-adequate external liquidity buffer.”
The January GIR can cover goods imports as well as primary income and services payments for 10.2 months, the BSP noted.
The latest dollar reserves level was also 8.4 times bigger than the country’s short-term foreign debt based on original maturity, and 5.7 times larger than external debt based on residual maturity, the BSP added.
The Philippines ended 2021 with a full-year BOP surplus amounting to $1.34 billion, down from the record $16.02 billion in 2020 when imports paid in dollars slid due to weak domestic consumption as a result of the pandemic-induced recession and the most stringent lockdowns imposed at the onset of the COVID-19 crisis. INQ