The surplus was derived from the capital and financial accounts surplus on the back of low current account deficit.Jakarta (ANTARA) - Indonesia's balance of payment swung to a surplus of US$4.1 billion in the first quarter (Q1) of 2021 after clocking a deficit of US$0.2 billion in the earlier quarter, according to Bank Indonesia (BI).
“The surplus was derived from the capital and financial accounts surplus on the back of low current account deficit,” Chief of the BI Communication Department Erwin Haryono noted in a written statement released on Friday.
The surplus brought the country’s foreign exchange reserves to US$137.1 billion at the end of March 2021, up from US$135.9 billion at the end of December 2020.
The foreign exchange reserves are sufficient to finance imports and repay the government foreign debts for 9.7 months and are above the international adequacy standard.
Related news: Indonesia's foreign debt recorded at US$415.6 billion in Q1: BI
Meanwhile, the current account in the first quarter of 2021 recorded a low deficit, though the balance of goods registered a surplus.
The current account recorded a deficit of US$1 billion, or 0.4 percent of the national gross domestic product (GDP), after clocking a surplus of US$0.9 billion, or 0.3 percent of the GDP in the previous quarter.
The balance of goods recorded a surplus on the back of good export performance, along with high demand in trade partner countries and a hike in global commodity prices.
In line with the positive export performance, coupled with an upward trend in domestic demand, the import performance increased accordingly, thereby maintaining the surplus of balance of goods.
Related news: Indonesia's balance of payment remains solid: BI
Meanwhile, a deficit in the balance of services rose due in part to a widening deficit in transportation services as a result of increased freight service payments in line with the rising import of goods.
The balance of primary income recorded was lower as compared to the previous quarter owing to a decline in the payments for coupons and dividends of portfolio investment.
Meanwhile, capital and financial accounts in the first quarter of 2021 recorded a surplus of U$5.6 billion, or two percent of the GDP, after suffering a deficit of US$1 billion, or 0.4 percent of the GDP.
The deficit was fueled by the rising portfolio investment owing to investors’ positive perception of the prospects for the domestic economy.
Portfolio investment recorded a net inflow of US$4.9 billion, higher than the surplus in the previous quarter, at US$2 billion. This was fueled by the issuance of global bonds and rising foreign investment inflows in the stock market. (INE)
Related news: Indonesia betting on SWF to attract foreign investment
Translator: Astrid Faidlatul H/Suharto
Editor: Yuni Arisandy Sinaga
Copyright © ANTARA 2021
