BOP surplus rises to $541 million in November

MANILA, Philippines — The country recorded a balance of payments surplus (BOP) of $541 million in November, the biggest in six months as more dollars continued to flow into the country, according to the Bangko Sentral ng Pilipinas (BSP).

The country has been enjoying surpluses in its BOP for five straight months and last month’s surplus was the biggest since the $928 million recorded in May.

However, the surplus in November was 36.2 percent lower than the $847 million surplus recorded in the same month last year.

The BSP said last month’s inflows reflected the central bank’s foreign exchange operations and rise in income from investments abroad as well as the increase in the national government’s net foreign currency deposits.

The inflows, it said, were offset by outflows representing payments made by the national government on its foreign exchange obligations.

The BOP is the difference in total values between payments into and out of the country over a period.

A surplus means more foreign exchange flowed in from exports, remittances from overseas Filipinos, business process outsourcing earnings and tourism receipts that what flowed out to pay for the importation of more goods, services, and capital.

For the first 11 months, the country’s BOP surplus amounted to $6.27 billion,

“The surplus may be attributed partly to lower trade in goods account deficit, higher net receipts in the trade in services account and personal remittance inflows from overseas Filipinos, and net inflows of foreign direct investments and foreign portfolio investments,” the central bank said.

Latest data from the BSP showed personal remittances from Filipinos abroad increased by 4.3 percent to $27.61 billion from January to October compared to $26.47 billion in the same period last year, while cash remittances coursed through banks went up by 4.6 percent to $24.86 billion from $23.77 billion.

On the other hand, net FDI inflows fell nearly 37 percent to $5.1 billion from January to September compared to $8.1 billion in the same period last year due to the global economic slowdown as well as the uncertainty brought about by the pending tax reform bill or the proposed Comprehensive Income Tax and Incentive Rationalization Act (CITIRA).

The BSP expects the Philippines to book a higher BOP surplus of $4.8 billion this year, reversing the $2.3 billion deficit recorded last year.