The country posted a balance of payments (BOP) deficit of $125 million last February as the national government settled its maturing foreign obligations amounting to about $1.4 billion, the Bangko Sentral ng Pilipinas (BSP) said on Wednesday.
Data released by the BSP showed that BOP deficit last February was a complete reversal of the $469 million surplus posted in the same month last year.
The BOP refers to an accounting record of all monetary transactions between a country and the rest of the world for a specific period.
Sources of funds (inflows), such as exports or the receipts of loans and investments, are recorded as positive or surplus items. Uses of funds (outflows), such as payments for imports or to invest in foreign countries, are recorded as a negative or deficit item. When all components of the BOP are summed up, it must balance - that is, it must equal to zero.
BSP Governor Amando Tetangco Jr. said in a text message that the amount used by the national government to settle and redeem its maturing financial obligations particularly global bonds exceeded the amount of foreign exchange inflows.
"This was due to timing issue, principally on national government inflows and redemptions. But the cumulative position is still in surplus," Tetangco pointed out.
The country's BOP position managed to stay positive in the first two months of the year after it booked a surplus of $1.233 billion in January with the proceeds of the $1.5 billion global bond issuance of the national government.
BSP Deputy Governor Diwa Guinigundo explained that the bulk of the outflows were due to debt servicing obligations that matured last month.
"This was due to debt servicing, mainly Eurobond maturities," Guinigundo said. About $1.4 billion worth of foreign obligations consisting of Eurobonds fell due in February.
Last year, the country's BOP surplus reached a new record level of $5.295 billion from a surplus of $89 million in 2008. The actual surplus was almost $300 million than the BSP's revised forecast of $4 billion and $5 billion.
Overseas Filipino workers' (OFW) remittances went up by 5.6 percent to a new record level of $17.35 billion last year from $16.42 billion in 2008.
The BSP sees the county’s Gross International Reserves (GIR) hitting a new record high of between $47 billion and $48 billion and the BOP posting a surplus of between $3 billion and $4 billion due to robust mining as well as business process outsourcing (BPO) sectors. It also expects OFW remittances to increase by six percent to about $18.1 billion.
Latest data released by the central bank showed that the country's GIR hit a new record high of $45.713 billion in February from $45.591 billion in January due to inflows mainly from the central bank's foreign exchange operations, income from investments abroad, and gold holdings while OFW remittances grew by 8.5 percent to $1.372 billion in January or $107 million more than the $1.265 billion in the same month last year. - OMG, GMANews.TV
