RP posts $93-M payment deficit in November

Foreign currencies paid out by the Philippines exceeded those that entered the country by $93 million in November, following debt payments by the central bank and National Government. The November balance of payment (BOP) deficit was a reversal of the $19-million surplus posted a year earlier, latest Bangko Sentral ng Pilipinas (BSP) data showed. For January to September, the Philippines recorded a $4.08-billion surplus — an elevenfold jump from the year-ago level — due to higher government borrowings, hot money inflows and robust remittances from Filipinos abroad. The payment balance is a record of a nation's total payments to foreign countries, including the price of imports and the outflow of capital and gold, along with total receipts from abroad, including the price of exports and the inflow of capital and gold. The central bank now expects the balance of payments to post a surplus of $4-$5 billion this year and a surplus of $3-$4 billion next year. The deficit was registered on the back of strong outflows brought about by the payment of maturing obligations of the national government and the central bank. A $150 million loan was also disbursed by the Asian Development Bank (ADB) for the Governance in Justice Sector Reform Program. The National Government, which is in dire need of funds to finance its swelling budget deficit, borrowed $3.25 billion by isuuing foreign-denominated bonds in the international capital markets. The amount was higher than the $2 billion borrowed by the government last year. The Philippines is staring at a record budget gap this year due to weak tax collections and higher spending to stimulate the economy. The deficit swelled to P266 billion as of end-October, breaching the P250-billion target for the year. The government earlier said the gap could go as high as P320 billion due to failure to sell big-ticket state assets. Meanwhile, latest central bank data also showed that the country’s gross international reserves (GIR) hit a new record of $43.73 billion in November from $36.83 billion a year earlier. The BSP expects international reserves to hit $43-$45 billion this year. — GMANews.TV