Indonesia’s Balance of Payments Registered US$4.0 Billion Surplus in Q4/2009

 

Indonesia's balance of payments in Q4/2009 posted a surplus of US$4.0 billion, up

from a surplus of US$3.5 billion in Q3/2009. This surplus is encouraged by the

performance of both the current account and the capital and financial account. In

response, international reserves at end-Q4/2009 mounted to US$66.1 billion,

equivalent to 6.5 months of imports and official debt service payments (as of January

2010, international reserves reached US$69,9 billion).

 

The current account in Q4/2009 recorded a more robust US$3.4 billion surplus

compared to US$2.2 billion in Q3/2009. This improvement was explained mainly by

buoyant exports driven by the ongoing recovery in the global economy and rising

prices of some main export commodities. The resurgent export performance was still

dominated by resource-based commodities requiring comparatively little imported

raw materials. Exports were also bolstered by higher oil prices and increased volume

of LNG exports with Trains 1 and 2 of Tangguh LNG plant entering operation. These

developments have resulted in faster export growth than import.

 

During the same period, the capital and financial account posted a US$1.4 billion

surplus primarily resulted from surplus on direct investment and portfolio investment.

Although pressures on international financial markets prompted a drop in foreign

investor risk appetite and hence triggered outflow of capital in certain instrument in

December 2009, the overall portfolio investment surplus still improved in Q4/2009

compared to one quarter earlier. The positive condition of the capital and financial

account was attributable to stable domestic macroeconomic conditions and

improving global liquidity.

 

For the whole 2009, the current account surplus reached US$10.6 billion,

considerably greater than the US$0.1 billion surplus in 2008. Similarly, the capital

and financial account managed a US$3.7 billion surplus, a turnaround from a deficit

of US$1.88 billion in 2008. Taken together, the overall 2009 balance of payments

charted a US$12.5 billion surplus, which compares to the US$1.95 billion deficit in

2008.

 

Sources: www.bi.go.id

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