by Roderick T. dela Cruz
The Philippines has lent more money to the rest of the world than what it borrowed over the past couple of years, the Bangko Sentral said in a report released Wednesday.
The Bangko Sentral, in its 2010 Flow of Funds Report, said the country’s net lending to the rest of the world amounted to P385.5 billion in 2010, lower than P450.3 billion registered in 2009.
The country became a net lender to the rest of the world after the Bangko Sentral, banks and other local financial institutions invested in securities issued by other countries such as the United States.
“Securities were the dominant instruments for financial transactions with the rest of the world. Aside from the Bangko Sentral, commercial banks and the insurance sector were the main investors in debt issues by non-residents. On the other hand, the national government was the top bond issuer offshore,” the Bangko Sentral said.
The report presents a summary of financial transactions among the four different institutions of the economy, and between these institutions and the rest of the world. These institutions are financial corporations, non-financial corporations, the general government, and the household sector.
Data showed that total savings in the economy improved to P1.71 trillion in 2010 from the previous year’s level of P1.57 trillion, with all sectors in the economy generating savings.
The household sector, for the third consecutive year, maintained its position as lead saver in the economy with total accumulated savings of P841.5 billion, a modest improvement of 6.4 percent from the year-ago level.
Meanwhile, savings in the non-financial corporations sector steadily grew at 14.6 percent to reach P692.9 billion in 2010, underpinned by strong net income that was observed in all industries, notably in food and beverage, real estate, transport and wholesale trade.