Bank Indonesia: Increased Foreign Exchange Reserves, Safe Foreign Debt Payments

Dollar bill illustration. (Photo: Doc. Antara)

JAKARTA - Bank Indonesia (BI) released information that the position of Indonesia's foreign exchange reserves until the close of February 2021 was in the position of IDR138.8 billion US dollars or equivalent to IDR1,991.6 trillion (exchange rate of IDR14,349).

Head of the BI Communication Department Erwin Haryono said the achievement was higher than the January 2021 period which was recorded at 138 billion US dollars or not less than Rp1,980.1 trillion.

"The position of foreign reserves is equivalent to financing 10.5 months of imports or 10.0 months of imports and servicing government foreign debt," he said in a press statement, Friday, March 5.

Erwin added that Indonesia's ability to collect foreign payment instruments exceeds the minimum standards that have been set globally.

"This foreign exchange reserve is above the international adequacy standard for about 3 months of imports," he said.

"Bank Indonesia considers the foreign exchange reserves to be able to support the resilience of the external sector and maintain macroeconomic and financial system stability," he continued.

Meanwhile, the cause of the increase in foreign exchange reserves in the first two months of this year was mainly due to the government's decision to collect financing in foreign currency.

"The increase in the position of foreign exchange reserves in February 2021 was mainly influenced by the withdrawal of government loans and tax revenue," Erwin added.

For information, the monetary authority on Monday, February 15 stated that the amount of Indonesia's foreign debt until the close of 2020 was US $ 417.5 billion or the equivalent of Rp.5,985.9 trillion (exchange rate of Rp.14,337).

Of this amount, the public sector (government and central bank) contributed US $ 209.2 billion and the private sector (including BUMN) US $ 208.3 billion.

"Going forward, Bank Indonesia views that foreign exchange reserves will remain adequate, supported by stability and maintained economic prospects, along with various policy responses to promote economic recovery," Erwin concluded.