Indonesia's Foreign Debt 2020 Approaches The Psychological Level Of IDR 6,000 Trillion, BI: Safe!

Dollar bill illustration. (Photo: Doc. Antara)

JAKARTA - Bank Indonesia (BI) reports that Indonesia's foreign debt (ULN) at the end of quarter IV / 2020 was recorded at US $ 417.5 billion or equivalent to IDR5,795 trillion (exchange rate IDR13,881) or close to the psychological level of IDR6,000 trillion .

Head of the BI Communication Department Erwin Haryono said the figure was contributed by the public sector (government and central bank) amounting to US $ 209.2 billion and the private sector (including BUMN) US $ 208.3 billion.

"This foreign debt grew 3.5 percent on an annual basis, but decreased from the previous quarter which amounted to 3.9 percent. The slowdown is mainly due to the decline in the private sector, ”he said in a press statement, Monday, February 15.

Erwin added that this development was supported by maintained investor confidence, thus encouraging the inflow of foreign capital in the Government Securities (SBN) market.

"We also saw a partial withdrawal of foreign loan commitments to support the handling of the Covid-19 pandemic and the National Economic Recovery (PEN) program," he said.

Even so, he ensured that the government would still manage debt prudently, credibly and accountably to support priority spending.

Meanwhile, some of these priority sectors are health services and social activities (23.9 percent of total government external debt), the construction sector (16.7 percent), the education services sector (16.7 percent), and the government administration, defense and government sectors. compulsory social security (11.9 percent), as well as the financial services and insurance sectors (11.1 percent).

"The structure of Indonesia's external debt remains healthy as reflected in the ratio to Gross Domestic Product (GDP) at the end of the fourth quarter of 2020 which was maintained at around 39.4 percent," he said.

Furthermore, the central bank official explained that the government and BI continued to strengthen coordination in monitoring the development of external debt, supported by the application of prudential principles in its management.

"The role of external debt will also continue to be optimized in supporting development financing and encouraging national economic recovery, by minimizing risks that can affect economic stability," Erwin concluded.