GIR settles at $99.8B as of end-Aug–BSP
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AY MENTS made by the national government on its foreign currency debts and lower gold prices pushed the country’s gross international reserves (GIR) to below $100 billion in August 2023, according to the Bangko Sentral ng Pilipinas (BSP). Based on the latest data, the country’s GIR level settled at $99.8 billion as of end-August 2023, from the end-July 2023 level of $100 billion. However, the GIR level in August 2023 was higher than the $97.44 billion recorded by BSP in August 2022.
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“ T he month-on-month decrease in the GIR level reflected mainly the National Government’s [NG] payments of its foreign currency debt obligations and the downward adjustments in the value of BSP’s gold holdings due to the decrease in the price of gold in the international market,” BSP said. The BSP also said the net international reserves decreased by $0.1 billion to $99.8 billion as of end-August 2023 from the endJuly 2023 level of $99.9 billion. This refers to the difference between the BSP’s reserve assets or GIR and reserve liabilities
or short-term foreign debt and credit and loans from the International Monetary Fund (IMF). The BSP’s reserve assets consist of foreign investments, gold, foreign exchange, reserve position in the IMF and special drawing rights. The 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 BSP, meanwhile, said the
latest GIR level represents a morethan-adequate external liquidity buffer equivalent to 7.4 month’s worth of imports of goods and payments of services and primary income. The central bank said the GIR is viewed to be adequate if it can finance at least three-months’ worth of the country’s imports of goods and payments of services and primary income. Moreover, the GIR in August is also 5.9 times the country’s short-term external debt based on original maturity and 4.1 times based on residual maturity. Cai U. Ordinario
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By Cai U. Ordinario @caiordinario
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NNUAL preparations for the holidays allowed the country’s manufacturing output to increase in July 2023, according to the latest Monthly Integrated Survey of Selected Industries (Missi) results released by the Philippine Statistics Authority (PSA). Based on the PSA, the Volume of Production (VoPI) for manufacturing registered a year-on-year growth of 5.7 percent in July 2023. This was faster than the year-onyear growth rate of 3.4 percent in the previous month. In July 2022, VoPI recorded an annual increase of 3.6 percent. “The month-on-month and yearon-year improvement in manufacturing production volume in July 2023 may be attributed to the seasonal increase in manufacturing/ production, and other economic activities in the third quarter 2023 in preparation for the seasonal increase or even peak in demand/sales for many businesses and industries during the fourth quarter or the Christmas holidays season,” Rizal Commercial Banking Corporation Chief Economist Michael L. Ricafort said in a note. See “Factory,” A2
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Friday, September 8, 2023 Vol. 18 No. 326
Dignitaries dressed in traditional Indonesian batik clothing arrive for the gala dinner at the Asean Summit in Jakarta, Indonesia, Wednesday, September 6, 2023. (Clockwise from top left) President Ferdinand Marcos Jr. and his wife Louise Araneta; US Vice President Kamala Harris; Canada's Prime Minister Justin Trudeau and his son Xavier; South Korea's President Yoon Suk Yeol and his wife Kim Keon Hee; Malaysian Prime Minister Anwar Ibrahim and his wife Wan Azizah Wan Ismail; and Japan’s Prime Minister Fumio Kishida and his wife Yuko. Story on President Marcos's engagements with Asean neighbors, below right. MAST IRHAM/POOL PHOTO VIA AP
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‘SLOWBALIZATION’ TO PERSIST, SAYS UK-BASED THINK TANK By Andrea E. San Juan
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@andreasanjuan
K-BASED think tank O x ford E conom ic s said the recent weakness in goods trade has been concentrated in Asia and Europe, noting that the trend of ‘slowbalization,’ which was visible since the global financial crisis, will persist. Oxford said the outlook for world goods trade growth remains “relatively downbeat.” “Our baseline forecast is a shallow trade recession, with world trade in goods dropping 1.5 percent this year before staging a modest recovery in 2024 with growth of 2.3 percent,” the UK-based think tank said in a research briefing on Wednesday. From 2019 to 2024, Oxford
Economics’ forecasts show that world trade in goods will grow at a similar pace to world gross domestic product (GDP) which is around 2 percent per year. This, it said, means that the trend of ‘slowbalization’ visible since the global financial crisis, featuring a flat global goods trade-to-GDP ratio, will persist. Geog raphica l ly, Ox ford said the recent weakness in goods trade has been concentrated in Asia and Europe. In fact, it said “world import volumes fell by around 2 percent year-on-year in May to June this year, declining 6 to 8 percent year-on-year in advanced Asia and 4 percent in the eurozone.” See “Slowbalization,” A2
PBBM looks to Asean allies for rice imports By Samuel P. Medenilla
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@sam_medenilla
ESPITE the country’s recently reported sufficient rice supplies, President Ferdinand R. Marcos Jr. is now eyeing more imports of the food staple from Vietnam and Cambodia to ensure the country’s longterm food security. At the sidelines of the 43rd Association of Southeast Asian Nations (Asean) Summit in Indonesia, Marcos met with Vietnamese Prime Minister Pham Minh Chinh to discuss a possible five-year rice supply agreement. Vietnam and Thailand are the country’s traditional sources of rice imports. During the first five months of the year, the country imported 1.5 million tons of rice from Vietnam, worth US$772.4 million.
Marcos, who is also the Agriculture secretary, said the proposed supply agreement aims to address future volatility in the rice market. “The suggestion of a longerterm arrangement is an important one because just having that as an assurance will stabilize the situation, not only for the Philippines, but for all of us in the region,” Marcos told Pham. They also talked about fishery and maritime cooperation as well as security and defense matters. In 2008, Vietnam agreed to sign a Memorandum of Agreement, wherein it agreed to sell 1,500,000 metric tons of rice to the government until 2010. The same arrangement will no longer be possible following the enactment of Republic Act (RA) No. 110203 or the Rice Tariffication See “PBBM,” A2
PESO exchange rates n US 56.9380 n japan 0.3857 n UK 71.2010 n HK 7.2604 n CHINA 7.7801 n singapore 41.7587 n australia 36.3321 n EU 61.0717 n KOREA 0.0428 n SAUDI arabia 15.1802 Source: BSP (September 7, 2023)