Data from the Bangko Sentral ng Pilipinas (BSP) showed that the November GIR was equivalent to five months worth of imports of goods and payment of services.
According to the BSP, however, the drop in the GIR was partly offset by the National Government’s deposit of the proceeds from its 10-year global bond flotation to prefund the government’s 2003 budget requirements.
The government also made other loan drawdowns, such as the Power Sector Reform Loan from the Asian Development Bank and the Co-financing Power Sector Reform Loan from the Japan Bank for International Cooperation.
The BSP reported that its net international reserves (BSP-NIR) as of end-November 2002 increased to $12.375 billion from $12.269 billion a month ago.
Despite the expected growth in the country’s exports next year, the BSP said it is not expecting growth in the balance of payments or the gross international reserves due to the heavy debt burden that has to be serviced in 2003.
BSP Governor Rafael Buenaventura said the 2003 balance of payments would still be at the target surplus of about $200 million and the gross international reserves would be kept at the $14 to $15-million level.
The BSP made identical projections for this year, anticipating growth in dollar remittances from overseas Filipino workers and tempered growth in the export sector, especially electronics and semiconductor.
"There will be no improvement in our balance of payments mainly because of our debt," Buenaventura said. "There will be some slight growth in foreign direct investments but not substantial,"he added.
For next, the government is expecting a 10 percent growth in exports due mainly to the recovery of the electronics sector which has been picking up since the start of 2002.
Buenaventura said there could be downsides to the country’s export performance next year but these could be evened out by other factors as well.
The country’s main trading partners, specifically the US and Japan, are expected to slow down in 2003 but Buenaventura said "there are also noticeable improvements in trade with other countries that, if summed up, could almost make up for the slack left by the major markets. "
This year alone, exports are originally expected to post zero growth but the rebounding electronics sector allowed exports to grow by 8.8 percent from January to September alone.
However, Buenaventura said the slowdown in the US economy would have an impact on exports and this might pare down the country’s export growth to only eight percent.