The surplus in
the country’s balance of payments surged by nearly five times last month from a
year ago, as optimism on the economy drove up investment inflows. - Photo courtesy of Reuters
By MICHELLE V REMO
MANILA: The
surplus in the country’s balance of payments (BOP) surged by nearly five times
in November from a year ago, as optimism on the economy drove up investment
inflows.
Officials said
the country became a preferred site for securities investments due to the
robust growth of the Philippine economy amid a weak external environment.
The Bangko
Sentral ng Pilipinas on Wednesday reported that the BOP surplus amounted to US$2.16
billion during the month, higher than the US$364 million reported in the same
month of 2011.
This brought
the cumulative surplus for the first 11 months of the year to US$8.6 billion,
which was, however, down by 16% from the US$10.18 billion registered in the
same period last year.
BOP is a record
of the country’s commercial transactions with the rest of the world. It
indicates the flow of dollars and other foreign currencies to and from the
country.
A surplus means
that the inflows have exceeded the outbound currencies.
A surplus in
the BOP adds to the country’s total reserves of foreign exchange reserves, or
gross international reserves (GIR).
Earlier, the
central bank reported that the country’s GIR amounted to a historic high of US$84.1
billion by the end of November.
BSP Governor
Amando Tetangco Jr told reporters that a key driver of the surplus in November
was the strong inflows of foreign portfolio investments.
So far this
year, the Philippines has become one of the fastest-growing economies in Asia.
In the first
three quarters, it grew by 6.5% from a year ago. As a result, the economy would
likely exceed its growth target of 5% to 6% for this year.
The
Philippines’ robust growth rate, at a time the eurozone is in the grip of a
crisis while the US economy continues to plod on, recently caught the attention
of credit-rating firms.
The Philippines
is now rated just a notch below investment grade by all three international
credit watchdogs—Fitch Ratings, Moody’s Investors Service, and Standard &
Poor’s.
Government
officials thus expect the Philippines to get an investment rating by next year.
Tetangco also
said proceeds of loans denominated in foreign currencies, as well as the
central bank’s own earnings from its investments, fueled the rise in the BOP. -- Inquirer
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