BI Records Indonesia's Payment Balance Deficit Of 1.5 Billion US Dollars In The Third Quarter Of 2023

Illustration (Photo: Doc. Antara)

JAKARTA - Bank Indonesia (BI) announced that the Indonesia Payment Balance (NPI) in the third quarter of 2023 still recorded a deficit of 1.5 billion US dollars.

This figure is lower than the deficit in the previous quarter of 7.4 billion US dollars.

Executive Director, Head of the BI Communication Department Erwin Haryono said that the condition of the NPI deficit was supported by the current account deficit and improved capital and financial transactions.

"With these developments, the position of foreign exchange reserves at the end of September was recorded to remain high at 134.9 billion US dollars, or equivalent to financing 6.0 months of imports and payment of government foreign debt, and was above the international adequacy standard of around 3 months of imports," Erwin wrote in a written statement, Tuesday, November 21.

The balance of transactions is improving, supported by improvements in the trade balance of goods and services that remain solid.

In the third quarter of 2023, the current account deficit (CAD) was recorded at US$0.9 billion or equivalent to 0.2 percent of GDP.

This value is much lower than the deficit of 2.2 billion US dollars or equivalent to 0.6 percent of GDP in the previous quarter.

Erwin added that the non-oil and gas trade balance surplus was increased, supported by improvements in demand for several export commodities, especially iron and steel, amid the trend in commodity prices that were still falling.

Meanwhile, the oil and gas trade balance deficit is increasing in line with the increase in world oil prices.

The improvement in the current balance of transactions was also supported by a decrease in the service deficit, which was supported by an increase in foreign tourist visits in line with the ongoing recovery of the tourism sector.

In addition, the primary revenue balance deficit has also decreased in line with the payment of yields to lower foreign investors.

Erwin said that the performance of capital and financial transactions has also improved amidst the increasing uncertainty of global financial markets.

Meanwhile, the deficit in capital and financial transactions was recorded at US $ 0.3 billion or equivalent to 0.1 percent of GDP.

Much lower than the deficit of US$4.8 billion or equivalent to 1.4 percent of GDP in the previous quarter.

"The low current deficit in capital and financial transactions is supported by the continued direct investment as a reflection of the maintained positive perception of investors towards domestic economic prospects," he explained.

Erwin said that Bank Indonesia assessed that the good performance of NPI in the third quarter of 2023 would be able to continue to support Indonesia's external resilience.

"In the future, Bank Indonesia will always pay close attention to the dynamics of the global economy that can affect the prospects for NPI and continue to strengthen the response of policy mixes supported by close policy synergies with the Government and relevant authorities to strengthen the resilience of the external sector," he said.