PH’s net external liability drops to $ 21 billion – Manila Bulletin

The Philippines’ net international investment position was $ 21.1 billion lower at the end of September 2021 compared to $ 22.7 billion in the previous quarter, the Bangko Sentral ng Pilipinas (BSP) reported.

Quarter-over-quarter net external liabilities decreased 7.3%, which is seen as an improvement in the country’s net international investment position.

On an annual basis, however, the country’s net international investment position has more than doubled from $ 10.3 billion at the end of September 2020, the PASB noted.

The IIP, as defined by the BSP using the description of the International Monetary Fund (IMF), is a statistical statement that “shows at a given point in time the value of the financial assets of residents of an economy which are claims on non-residents or are gold bars. held as reserve assets and liabilities of residents of an economy to non-residents. The difference between assets and liabilities is the net position in the IIP and represents either a net claim or a net liability to the rest of the world.

PASB said the higher net international investment position in the third quarter of 2021 was due to the 13.1% increase in the country’s total external liabilities, to $ 229.7 billion. This exceeded the 8.8% increase in the stock of external financial assets of $ 219.4 billion.

“The growth in the stock of external financial liabilities is a result of increases recorded in almost all accounts, especially portfolio, direct and other investments,” PASB said.

Based on preliminary IIP data, there was a 1.5 percent increase in the country’s total external financial assets in the third quarter, from $ 235.3 billion to $ 238.7 billion. BSP said the increase more than offset the 0.7 percent “marginal increase” in total external financial liabilities of $ 259.8 billion.

BSP said external financial assets were supported by residents’ other investment which rose 7.8% to $ 31.8 billion, while reserve assets held by BSP rose 0.8% to $ 106.6 billion. Direct investments also rose 0.8% to reach $ 65.6 billion.

On the other hand, the increase in total external financial commitments is due to the 230.6% growth in the allocation of Special Drawing Rights (SDRs) by the IMF. External financial liabilities increased by $ 4 billion due to SDRs and 5.5% growth in investments by non-residents in debt instruments issued by their local subsidiaries to $ 47.3 billion, said the BSP.

Regarding external financial assets, the PASB said that 46.7% of the country’s total external claims on the rest of the world were held by the PASB to the tune of $ 111.4 billion at the end of September 2021.

The “other sectors” under the external financial liabilities, accounted for 64% of the total external financial liabilities of the country at 166.2 billion dollars at the end of September 2021, said the PASB. “Other sectors” are other financial companies which include private and public insurance companies, holding companies, government financial institutions, investment companies, among others.


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Shirlene J. Manley