Indonesia's Foreign Debt Increases To 407.1 Billion US Dollars, This Is Its Allocation

Illustration (Photo: Doc. Antara)

JAKARTA - Bank Indonesia noted that Government Foreign Debt (ULN) at the end of the fourth quarter of 2023 reached 196.6 billion US dollars, an increase of 5.4 percent on an annual basis or year on year (yoy), also increased from growth of 3.3 percent (yoy) in the previous quarter.

Executive Director, Head of the BI Communication Department Erwin Haryono said that the development of the external debt was mainly caused by the withdrawal of foreign loans, especially multilateral loans, to support the financing of several programs and projects.

The increase in Indonesia's external debt was also influenced by the increase in the placement of portfolio investments in the domestic and international Government Securities (SBN) market, along with positive sentiment, market participants' trust is in line with the easing of global financial market uncertainty.

"The government is committed to maintaining credibility by fulfilling the obligation to pay principal and interest on time, as well as managing external debt carefully, efficiently, and accountably," he explained in his statement, Thursday, February 15.

Erwin conveyed that as one of the components in the APBN financing instrument and in order to continue the momentum of economic growth, the use of external debt continues to be directed to focus on supporting the Government's efforts to finance the productive sector and prioritize spending.

The financing support includes the health services and social activities sector of 23.7 percent of the total government external debt, government administration, defense and social security required 18.9 percent, education services 16.6 percent, construction 14.1 percent, and financial services and insurance 9.7 percent.

Erwin conveyed that the government's external debt position is relatively safe and under control considering that almost all external debt has a long-term tenor with a share of 99.8 percent of the total government external debt.