go through Luisa Maria Jacinta C. Josen, Senior Reporter
Philippines's payment balance (BOP) deficit widens Data from Bangkok Sentral Ng Pilipinas (BSP) shows that the government has repaid foreign debts.
BSP said on Monday that the BOP deficit in April was $2.56 billion, a gap of $639 million a year ago and a shortage of $970 million in March.
BOP measures the country's transactions with the rest of the world. The deficit shows that the Philippines withdraws more funds, and a surplus means that more money is entering the country than the remaining funds.
“The BOP deficit reflects the gradual decline of the national government (NG) on its foreign currency deposits with BSPs to meet their foreign debt obligations and pay their various expenses, as well as the net foreign exchange operations of BSPs,” the central bank said.
The latest data from BSP shows that as of the end of December 2024, the Philippines' outstanding foreign debt increased by 9.8% annually to US$137.63 billion.
This has increased the gross domestic product (GDP) of external debt and box office to 29.8% by the end of 2024 from 28.7% in the previous year.
BOP positions in the country are $5.52 billion The first four months of 2025, the balloon Starting with the $401 million gap a year ago.
“Based on preliminary data, this year to presentFICTER REFL“The trade mainly leads to an expansion of the commodity deficit,” the central bank said.
The country's trade balance in goods was US$4.13 billion in March, 23% higher than the same period last year. This brought the trade deficit to $12.71 billion in the first quarter, an increase of 12.8% year-on-year.
It added: “However, this decline is partially in trouble due to personal remittances from overseas Filipinos and from foreign borrowings by NG.”
Cash remittances rose 2.6% in March to $2.81 billion, although it was the slowest growth in nine months.
In March, NG's debt borrowing fell 7.15% to pesos 19.45 billion, while total foreign debt fell 31.89%.
Meanwhile, BOP reflects the final position of the final International Reserve (GIR), which was below $100.67 billion as of the end of March.
“The latest GIR levels provide a strong external liquidity buffer,” the central bank said.
The dollar reserves are sufficient to cover 3.7 times the country's short-term foreign debt based on residual maturity.
A large number of foreign exchange buffers keep the economy safe from market volatility, which is a guarantee of the country's ability to repay debts in a downturn.
GIR also equals the value of 7.3 months of payment for goods and services and the value of first-time income.
Michael L. Ricafort, chief economist at Rizal Commercial Banking Corp., said the broader BOP deficit is due to the ongoing gap in trade gaps and the repayment of foreign currency debt and other foreign obligations.
However, he also pointed out that due to U.S. tariff policies, foreign investment has declined due to volatility in financial markets.
Mr Ricafort said in the coming months that BOP positions could be improved as the gains from NG foreign currency debt may increase GIR.
He also quoted “OFW remittances, BPO income, exports, foreign tourism income and Other structural dollar inflows in the country. ”
“Looking forward, any improvements to BOP and GIR data in the coming months may still help provide a greater buffer for PESO Exchange,” Mr Ricafort said.
This year, BSP expects the country's BOP stance to end with a $4 billion deficit, equivalent to -0.8% of GDP.
BOP's position earned $609 million in 2024, and its $36.72 billion surplus fell by 83.4% as of the end of 2023.
