By Eileen Mencias
The Philippines’ overall balance of payments (BOP) posted a $895 million deficit in February 2023, surpassing last year’s $157 million deficit for the same month.
The BOP shortfall reflected outflows mainly from the government’s net foreign currency withdrawals from the BSP to settle foreign currency debt obligations and other expenses.
Despite the February deficit, the cumulative BOP position remained at a surplus of $2.2 billion for the first two months of the year. This is a turnaround from the $259 million deficit recorded during the same period last year.
Preliminary data showed that the cumulative BOP surplus was driven mainly by the government’s global bond issuance, personal remittances, and foreign portfolio investments.
The country’s gross international reserves (GIR) decreased to $98.2 billion as of end-February, down from $100.7 billion at the end of January. Nonetheless, the current GIR level represents an adequate external liquidity buffer, equivalent to 7.4 months’ worth of imports of goods and payments of services and primary income.
It is also about 5.9 times the country’s short-term external debt based on original maturity and 3.9 times based on residual maturity.
