Philippines Balance of Payment Surplus Reached Record-high Levels

MANILA, PHILIPPINES - The Philippines' balance of payments (BOP) surplus rose to $2.029 billion during the first two months of the year.

This was the result of strong dollar inflows and dollar proceeds from the government's global and euro-bond issues, according to Central Bank of the Philippines.

In January, the country recorded the highest one-month BOP surplus since 2002 at $1.925 billion.

The total BOP surplus for January-February period was at $2.407 billion, which is almost 80 percent of the country's BOP surplus for the entire 2005.

The balance of payment (BOP) refers to the sum of the country's transactions with the rest of the world. A surplus position indicates that the country would have more than enough foreign currency to service its maturing foreign debt.

A high BOP surplus would give the Philippines enough flexibility to support the peso when volatility is high, thus preventing wild fluctuations in the peso-dollar exchange rate.

Aside from strong dollar inflow, the country's foreign currency operations as well as investment income also contributed to the BOP surplus.

The Central Bank of the Philippines also reported that the country's gross international reserves are up, equivalent to 3.3 times the country's short-term debt based on original maturity, and is adequate to cover about 4.4 months of imports of goods and payments of services and income.

The Central Bank of the Philippines estimates that the gross international reserves by the end of 2006 will reach between $18 billion to $18.6 billion and as a result, mainly due to record-high remittances from overseas workers.

Remittances from overseas Filipino workers are expected to reach between $11 Billion to $12 Billion in 2006.

3/18/06

Source: Philippine Star

More Philippines News >>

Top of Philippine News: Balance of Payment


Philippines Travel and Business Guide

Web www.selectphilippines.com