PH to remain net creditor in IMF’s FTP until January 2025

The Philippines will remain a net creditor in the Financial Transactions Plan (FTP) International Monetary Fund (IMF) until January 2025, indicating that the country will continue to lend more than it borrows in the multilateral institution, the central bank announced Wednesday.

The Monetary Board of the Bangko Sentral ng Pilipinas (BSP) approved the continued participation of the Philippines in the FTP from August 2024 to January 2025 after participating first in 2010, citing the country’s external position and its reserves.

“Given that the country’s external position remains strong, with ample gross international reserves to withstand external shocks, the country has been assessed to be eligible for continued participation in the FTP,” the BSP said in an emailed statement.

Latest data available shows that the Philippine balance of payments (BOP) position stood at a $62-million surplus in July, reversing the $155-million deficit in June, and the $53-million surplus the same month last year.

The payments position takes into account Philippine transactions with the rest of the world during a specific period. A surplus means more funds entered the country, while a deficit means more funds exited.

Dollar reserves — a measure of the ability to settle import payments and service foreign debt — climbed to $105.647 billion in July, up from $105.188 billion in June, and $99.951 billion the same month last year.

The FTP is a currency exchange agreement between the IMF and eligible members to facilitate the IMF lending operations with other member countries. The IMF pays remuneration to the FTP participants such as the Philippines.

According to the BSP, members included in the FTP are considered through their balance of payments and reserve position, the stability of the exchange and financial markets, and the adequacy of the country’s international reserve assets to ensure that they fulfill obligations during the specified period.

“This puts the Philippines in a favorable position to remain as a Fund financial partner, which is an indication of the country’s commitment to contribute to the global financial safety nets and support the resolution of possible crises,” it said.—AOL, GMA Integrated News