The country’s gross international reserves (GIR) climbed to US$16.052 billion as of end-December 2004, higher by 1.1 percent compared to US$15.872 billion a month earlier. The year-end GIR level far exceeded the $14-$15 billion target level for end-2004 and was adequate to cover about 4.1 months of imports of goods and payments of services and income. Alternatively, this level was equivalent to 2.9 times the country’s short-term debt based on original maturity and 1.5 times based on residual maturity. Short-term debt based on residual maturity refers to outstanding short-term external debt on original maturity plus principal payments on medium- and long-term loans of the public and private sectors falling due within the next 12 months.
The increase in reserves in December was attributed mainly to: (1) the deposit by the National Government (NG) with the BSP of the proceeds of its program and project loans ($156 million); and (2) the investment income from BSP’s placements abroad ($21 million). These inflows were, however, partly offset by the debt service requirements of the NG and the BSP.
The BSP’s net international reserves (BSP-NIR) as of end-December 2004, inclusive of revaluation of reserve assets and reserve-related liabilities, increased to $14.381 billion from the November level of $14.207 billion.