Tuesday, 20 April 2010

$1.36-B BOP surplus posted in Q1

Jun Vallecera
Business Mirror

THE country’s balance of payments (BOP) swung from a deficit of $125 million in February to a surplus reaching $255 million in March, the Bangko Sentral ng Pilipinas (BSP) said on Monday.

This pushed the three-month balance to a surplus of $1.36 billion and was seen to strengthen further the country’s external sector.

“Strong foreign-exchange inflows from overseas Filipinos, portfolio investments, the national government’s foreign borrowings and merchandise exports supported the overall BOP position,” BSP Governor Amando Tetangco Jr. said in a text message.

Much of the surplus was owed to proceeds from the samurai bond sale of $1.1 billion offered to investors in February but forming part of the inflows only the following month.

“This healthy external position intensifies our buffer against potential external vulnerabilities,” Tetangco said of the BOP’s significance.

He earlier forecast the BOP to attain a surplus ranging from $3 billion up to $4 billion this year, a rather conservative view of this aggregate indicator which attained a surplus reaching $5.29 billion just last year.

Tetangco said the surplus state should get support from the remittance of overseas Filipinos, also seen earlier to expand by at least 6 percent this year to more than $18 billion.

The remittances, he said, should continue to expand this year given continued demand for Filipino labor in much of the world’s workplaces such as the Middle East countries, the United States, Italy and Japan, among others.

There is optimism of continued high remittance flows this year, essentially because the global economy continues also to show signs of a return to growth following a period of difficult economic conditions, Tetangco said.

He noted global inflation, which contracted during the recession phase, has moved back to positive territory and has forced countries as Australia, China, Vietnam and Malaysia to make appropriate monetary-policy adjustments.

The Philippines, Tetangco said, was not expected to follow suit till at least later this year.

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