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By Maricel E. Burgonio, Reporter
THE country is unlikely to hit its dollar surplus target this year
amid the global financial crisis, according to sources at the Bangko
Sentral ng Pilipinas (BSP).
A source said the BSP’s balance of payments
(BOP) surplus target was made before the bankruptcy of Lehman
Brothers Holdings Inc. last month. The failure of the US investment
bank has exacerbated risk aversion, as investors pull their money
out of high-risk investments such as those in emerging markets like
the Philippines. This flight to quality has led to record slumps in
financial markets worldwide.
The BSP earlier cut its target for the
country’s BOP surplus to $2 billion this year, from an earlier
forecast of $2.5 billion, primarily due to record oil prices. The
Philippines is a net importer of crude.
BSP Governor Amando Tetangco Jr. said the
central bank is already studying its current BOP surplus projection
in light of recent developments.
“I asked to study [the BOP forecast]. We have
to study it first and we have two more months left. It’s a regular
review,” he told reporters.
In the first nine months of this year, the
country’s BOP surplus slipped to $1.540 billion as its external
payments position last month registered a $482 million deficit,
wider than August’s $54 million shortfall.
For next year, the central bank forecast a BOP
surplus of $2.3 billion. Last year, the country’s dollar surplus
hit a record $8.4 billion.
On Tuesday, Tetangco said the global financial
contagion has infected the Philippines, citing the steep falls of
the peso and the local stock market. Heightened risk aversion led to
greater outflows of foreign portfolio investments, while the US
economic slowdown cut the Philippines’ exports.
Net foreign portfolio investments posted a huge
outflow of $503.99 million as of September 26 this year compared
with an inflow of $187 million at end-August this year and $3.401
billion inflows at end-September last year.
The BSP also expects the country’s trade
deficit to widen to $13.2 billion this year compared with the
earlier forecast of $8.6 billion and last year’s $5.047 billion.
In the first half this year, the country’s external trade account
registered a $6.4 billion deficit, as the Philippines spent more on
imports at $31.6 billion, while earnings from exports reached only
$25.2 billion.
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