GIR surges 13.5% to $18.4B in ’05

GIR surges 13.5% to $18.4B in ’05
By Des Ferriols
The Philippine Star 01/07/2006
http://www.philstar.com/philstar/NEWS200601070703.htm

The country’s gross international reserves (GIR) rose by 13.5 percent to $18.4 billion in December last year from the level recorded in the same period in 2004, the Bangko Sentral ng Pilipinas (BSP) reported yesterday.

The BSP said the end-December level was $1.4 billion more than the government’s target of $17 billion due primarily to massive dollar remittances from overseas Filipino workers (OFWs).

The BSP also said the December GIR was two percent higher than the end-November 2005 level of $18.059 billion.

BSP Governor Amando M. Tetangco Jr. said the end-December GIR was enough to cover about 3.8 months worth of imports of goods and payments of services and income.

This level, Tetangco said, was also equivalent to 2.9 times the country’s short-term debt based on original maturity and 1.6 times based on residual maturity.

Based on BSP data, the country’s GIR surpassed the 2004 level as early as June last yar when the reserves reached $17.337 billion due to the government’s $750-million global bond issue.

Because of strong inflows, the BSP has already upgraded its projected balance of payments (BOP) surplus for this year from $852 million to $2 billion, mainly due to record-high remittances from overseas workers.

Remittances from overseas Filipino workers, according to Tetangco, is expected to reach $11 billion and could possibly go up to as high as $12 billion including the inflows not captured by the banking system.

Early in the year, the BSP was only expecting the GIR to reach at least $16 to $17 billion compared to the original projection of $14 billion to $16 billion.

For this year, the BSP expects the GIR at $18 billion to $20 billion with dollar investments coming into the mining sector.