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Saturday, July 19, 2025 Vol. 20 No. 279
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BOP SWINGS TO DEFICIT SURVIVING IN SCARBOROUGH OF $5.59B IN JAN-JUNE
T
HE country’s balance of payments (BOP) swung to a deficit in the first six months of 2025, according to the latest data released by the Bangko Sentral ng Pilipinas (BSP).
The data showed the BOP reversed to a deficit of $5.59 billion in January to June 2025 from the surplus of $1.44 billion in January to June 2024. “[The] preliminary data indicate that the year-to-date BOP deficit was largely due to the continued trade in goods deficit,” BSP said in a statement. The Central Bank noted that the Philippine Statistics Authority’s (PSA) International Merchandise Trade Statistics (IMTS) disclosed that the trade deficit for JanuaryMay 2025 settled at $19.7 billion, down from the $20.7-billion deficit posted in January-May 2024. “This decline was partly offset, however, by the sustained net inflows from personal remittances from overseas Filipinos, foreign borrowings by the NG, and foreign portfolio investments,” BSP added. Rizal Commercial Banking Corporation Chief Economist Michael L. Ricafort said the recent geopolitical risks in the Middle East and the Israel-Iran war since June 13, 2025, could weigh down the country’s BOP data in the coming months. Ricafort explained that these risks have already increased global crude oil prices to a three-month high and depreciated the peso to the P57 level. However, compared to the $5.82 billion recorded in the period ending in May 2025, the BOP deficit narrowed. BSP said this was
due to the surplus recorded in the month of June 2025. The data showed the BOP registered a surplus of $226 million in June 2025, marking a reversal from the $155-billion deficit recorded in June 2024. “The BOP surplus reflected the foreign currency deposits by the national government (NG) with the BSP and income from BSP investments,” the BSP said.
BALANCE OF PAYMENTS PLUNGES IN 2025
Weaker trade performance leads to $5.59-B shortfall Jan–Jun 2024
$1.44B
Jan–Jun 2025
–$5.59B
GIR rises
❝Further/sustained growth in the country’s structural US dollar inflows would lead to better data for BOP, which is the country’s US dollar/ foreign currency cash flow statement (inflows minus outflows) with the rest of the world, also providing support for the GIR data. ❞ — RCBC Chief Economist Michael L. Ricafort
❝This decline was partly offset, however, by the sustained net inflows from personal remittances from overseas Filipinos, foreign borrowings by the NG, and foreign portfolio investments.❞ — BSP
BM Graphics: Ed Davad/Source: BSP
By Cai U. Ordinario
MEANWHILE, the BOP position mirrored the increase in the gross international reserves (GIR), which rose to $106 billion by end-June 2025 from $105.2 billion as of endMay 2025. The BSP said the latest GIR level provided a robust external liquidity buffer, equivalent to 7.2 months’ worth of imports of goods and payments of services and primary income. The latest GIR level ensures availability of foreign exchange to meet balance of payments financing needs, such as for payment of imports and debt service, in extreme conditions when there are no export earnings or foreign loans. “Further/sustained growth in the country’s structural US dollar inflows would lead to better data for BOP, which is the country’s US dollar/foreign currency cash flow statement (inflows minus outflows) with the rest of the world, also providing support for the GIR data,” Ricafort said. Moreover, it covers about 3.4 times the country’s short-term external debt based on residual maturity. BSP said short-term debt based on residual maturity refers to outstanding external debt with original maturity of one year or less, plus principal payments on medium- and long-term loans of the public and private sectors falling due within the next 12 months. The country’s GIR is made up of foreign-denominated securities, foreign exchange, and other assets including gold. It helps a country finance its imports and foreign debt obligations, stabilize its currency, and provide a buffer against external economic shocks.
As tariff sword hangs, PBBM to seek good deal with Trump By Samuel P. Medenilla
P
RESIDENT Ferdinand Marcos will push for a “mutually beneficial” agreement on reciprocal tariffs as well as stronger investment and security cooperation during his meeting with US President Donald Trump next week. Marcos will be on an official visit to Washington, D.C., from July 20 to 22, 2025, as the first Association of Southeast Asian Nations (Asean) leader who will personally meet with Trump. Department of Foreign Affairs (DFA) Assistant Secretary Raquel R. Solano attributed the honor given by Trump to Marcos to the longstanding iron-clad treaty between the Philippines and the US. “So, I would think that the invitation for the President to visit is an affirmation of the regard that the United States has for the Philippines,” Solano said in a press briefing in Malacañang on Friday.
Mutually beneficial
COMPARED to his four previous visits in the US since 2022, Marcos’s trip to the US next week will be brief and on a tight schedule;
US President Donald Trump is expected to welcome President Ferdinand Marcos Jr. in Washington, D.C., next week. The two leaders will tackle reciprocal tariffs, investments, and security cooperation in the West Philippine Sea. AP/ALEX BRANDON
and the first since Trump took office this year. Palace Press Officer Claire Castro said First Lady Louise “Liza” A. Marcos will not join Marcos in the US trip since she will go to Riyadh, Kingdom of Saudi Arabia, next week to meet with overseas Filipino workers (OFWs). “The trip originally proposed and scheduled on the first week of
July will highlight the steadfast commitment of the Marcos administration to the welfare of OFWs and their families. She will be back on July 21st,” Castro told Palace reporters in a briefing on Friday. Solano said the meeting between Marcos and Trump will focus on closer cooperation in economic, defense and security matters, including the looming increase of the
“reciprocal” tariff rates imposed by the US on Philippine goods from 10 percent to 20 percent next month. Citing the position of the Department of Trade and Industry (DTI), Solano said the country will try to significantly reduce the said tariff rate so Philippines goods will continue to be affordable in the US market. “We hope, of course, to arrive at a bilateral trade agreement or a deal on reciprocal trade that is mutually acceptable, mutually beneficial for both our countries,” the DFA official said. Special Assistant to the President for Investment and Economic Affairs Frederick D. Go and other trade officials are currently in the US for tariff negotiations.
Security matters
ON security matters, Marcos and Trump will talk about the security situation in the West Philippine Sea, where Chinese ships continue to have a growing presence, as well as US support for enhancing the capabilities of the Armed Forces of the Philippines (AFP) and the Philippine Coast Guard (PCG). Also part of the discussions is Continued on A2
A LIGHT fishing boat sets out to sea on Tuesday, July 15, 2025, as bigger “mother boats” remain anchored near the municipal fish port in Subic, Zambales. HENRY EMPEÑO
By Henry Empeño
M
ASINLOC, Zambales—Up the street leading to this town’s municipal fish port is a virtual junkyard of derelicts. There, more than a dozen fishing boats lay idle by the seashore: hulls on unfamiliar ground, rudders rusting, bamboo decks rotting, outriggers crusted with barnacles, tattered tarps limp in the wind. “That’s the last one that tried going to the Scarborough Shoal, when it was rented by some journalists,” said Shiela Forones, pointing to FBCA La Salvia, the biggest of the lot. “But it came back soon, chased by the Chinese.” La Salvia’s FBCA designation meant it is a fishing boat with commercial authorization from the Bureau of Fisheries and Aquatic Resources (BFAR). But according to Forones, it has not been going out to sea for some time now. “The last fishing trip it made was in 2022,” Forones recalled. The boat captain, Viany Mula, who is her uncle, has now returned to Pangasinan where he operates a smaller boat fishing in municipal waters, she said. Shiela’s father, Efren, also captained a vessel similar to La Salvia and fished in the vicinity of the Scarborough way back in the early 2000s. But today, the former deep-sea boat skipper goes out with a smaller fiberglass boat from BFAR—catching smaller fishes while eking marginal living from a sea that used to provide plenty.
DRIED-OUT barnacles still cling to the outriggers of FBCA La Salvia, a testament to its previous active life at sea. HENRY EMPEÑO
MONITORING sizes of fish catch from municipal waters in Masinloc. FARMC
GOV. Hermogenes Ebdane Jr. discusses concerns with fisherfolk in San Felipe, Zambales, in this photo taken in March last year. TAKTIKOM
Expensive trips, less catch
SCARBOROUGH Shoal, or Bajo de Masinloc (literally Masinloc shallows), is located some 124 nautical miles off Zambales. A traditional fishing ground for local fishermen for decades, that was where locals used to harvest tons and tons of reef and oceanic fishes. “Life was good then, and we made enough,” Forones fondly remembered. That time, her father received a regular pay of P5,000 per trip as boat captain, whether fishing was good or not. And this he supplemented with extra income from the fish he personally caught at sea during fishing trips. This is not true anymore, lamented Leonardo Cuaresma, president of the New Masinloc Fishermen’s Association, which counts among them fisherfolk who rely on deep-sea payao fishing for a living. “We can no longer access Bajo de Masinloc, that is the sad reality,” Cuaresma said. Because of this, locals, even commercial fishers, have been skipping the shoal, sometimes going farther out beyond in the hope of breaking even. But the result, he said, is more and more expensive fishing trips that often yielded less and less fish catch. Meanwhile, those who opted to make do with fishing in municipal waters found out soon that it was only good enough for marginal income. Forones said her father now usually nets P3,000 from three days’ worth of fishing and considers himself lucky enough to earn P8,000 a week if the catch was good.
Chinese chokehold
THE problem all began in 2013 when Chinese militia vessels put up a barrier at the mouth of Scarborough and began patrolling the area, shooing Filipino fishermen away, said Cuaresma. This was after the infamous Scarborough standoff in April 2012 when the Philippine Navy tried to arrest eight Chinese fishing vessels found to be poaching at the shoal. Continued on A2
PESO EXCHANGE RATES n US 57.1240 n JAPAN 0.3846 n UK 76.6547 n HK 7.2785 n CHINA 7.9550 n SINGAPORE 44.4406 n AUSTRALIA 37.0392 n EU 66.2581 n KOREA 0.0410 n SAUDI ARABIA 15.2294 Source: BSP (July 18, 2025)