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By Maricel E. Burgonio, Reporter
THE country’s dollar reserves last May were up
by nearly half from a year ago, according to the Bangko Sentral ng
Pilipinas (BSP).
In a statement, BSP Governor Amando M. Tetangco
Jr. said the country’s gross international reserves (GIR) reached
$36.6 billion at end-May from $36.4 billion at end-April.
The country’s foreign exchange reserves stood
at $25.6 billion at end-May last year, so this year’s figure
translates to a 43-percent increase year on year.
The end-May GIR allows the country to pay for
6.2 months of imports of goods and payments of services and income.
Alternately, this would allow the country to pay 5.2 times over its
short-term external debt based on original maturity, and 3.4 times
over its debt based on residual maturity, which includes current
portions of long-term liabilities.
Excluding the country’s short-term
liabilities, its net international reserves stood at $36.6 billion
from $36.3 billion at end-April. The BSP expects to end the year
with a dollar surplus of GIR to increase to $37 billion this year
from $33.751 billion last year.
A rising reserve level helps temper consumer
price increases, as the increasing amount of foreign exchange boosts
the peso’s value, thus pulling down the cost of imported goods.
Stronger reserves however may also be
inflationary, as the surge in foreign exchange inflows increases
domestic liquidity or the money supply.
The BSP ascribed the increase in the country’s
reserves level to the government’s proceeds from asset sales, and
the central bank’s income from investments abroad.
Tetangco said the increase in reserves was
mainly due to the money raised by state-run Power Sector Assets and
Liabilities Management Corp. (Psalm) from the sale of generating
plants of the National Power Corp. (Napocor). Also contributing to
the country’s reserves level was the central bank’s income from
its investments abroad.
“These receipts were partly offset by outflows
arising from payments of maturing foreign currency denominated
obligations of the [government] and the BSP,” Tetangco said.
The Philippines had maturing obligations
amounting to $160 million at end-May, with the government accounting
for $148 million and the BSP, $12 million.
Psalm netted $262 million while the BSP earned
$95 million from its investments abroad.
Psalm, which is tasked to dispose of Napocor’s
power plants, already achieved a 42.8-percent privatization
threshold and would need only auction off a couple of facilities to
meet the 70 percent minimum provided for under the Electric Power
Industry Reform Act of 2001. Attaining this minimum would usher in
the so-called open-access regime, under which consumers can choose
their power suppliers.
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