BSP-The Philippine Balance Sheet Approach (BSA) Report: The Country's Net External Liability Position Increased in Q1 2021.
ENPNewswire-October 1, 2021--BSP-The Philippine Balance Sheet Approach (BSA) Report: The Country's Net External Liability Position Increased in Q1 2021
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Release date- 29092021 - The Philippine Balance Sheet Approach (BSA) Report: The Country's Net External Liability Position Increased in Q1 2021.
External Exposure. The country's net external liabilities widened by 3.5 percent to P676.6 billion from P653.8 billion in Q1 2020. The increase in the country's net debtor position against the rest of the world (ROW) was mainly driven by a) higher net foreign liabilities of the general government (GG), and b) increase in the non-financial corporations' (NFCs) net liabili?ty position against the ROW.
Infographic Q1 2021 Philippine Balance Sheet Approach.jpg
Key Developments and Cross-sectoral Exposures of the Domestic Sectors.
o The GG's net liability position rose 31.6 percent to P5.8 trillion from P4.4 trillion in Q1 2020. The GG posted higher net liabilities against the ROW and other depository corporations (ODCs). At the same time, the GG reversed its position with the Central Bank (CB) from a net creditor at P84.1 billion to a net debtor at P590.9 billion in Q1 2021. The reversal is due to GG's liabilities to the CB which nearly tripled to P2.1 trillion from P740 billion a year ago. In particular, the CB more than quadrupled its government security (GS) holdings to P1.5 trillion from P329 billion due to its purchases of GS in the secondary market.
Similarly, the GG's liabilities to the ODCs, which were mainly debt securities, also surged to P3.4 trillion from P2.9 trillion. Furthermore, the GG's external indebtedness increased to P2.7 trillion from P2.2 trillion, on account of higher foreign loans of the National Government (NG).
o The NFCs recorded a higher overall net financial liability position of P7.1 trillion from P6.9 trillion in Q1 2020. This ensued as the NFCs' net liabilities to ROW expanded by 14.5 percent to P3.1 trillion from P2.7 trillion, while that of the other financial corporations (OFCs) increased by 19 percent to P2.1 trillion from P1.8 trillion. Meanwhile, the NFCs' gross liabilities to the ODCs declined by 2.1 percent, following the 3.3 percent contraction in its bank loans, reflecting the continued tightening of bank credit conditions amid the economic uncertainties surrounding the ongoing pandemic.
o The ODCs' net financial assets increased by 34.9 percent to reach P2.1...
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