RP says end-January reserves at $39.6B

ABS-CBN News

Posted at Feb 06 2009 04:53 PM | Updated as of Feb 07 2009 12:54 AM

The country's gross international reserves (GIR) rose to a record $39.6 billion at the end of January this year, due largely to more government borrowings and inflows from its asset privatization program, the central bank said on Friday.

The current level of foreign reserves, up from a revised $37.6 billion at end-December, is equivalent to 4.8 times the country's short-term foreign debt based on original maturity and 3.0 times based on debt falling due in the next 12 months.

"The marked increase in reserves was due mainly to deposits by the national government of proceeds from its 10-year bond issue, and by the Power Sector Assets and Liabilities Management Corporation of proceeds from the privatisation of the National Transmission Corp.," the Bangko Sentral ng Pilipinas (BSP) said in a statement.

According to the BSP, the country's foreign exchange reserve was enough to cover six months worth of imports of goods as well as payments of services and income.

Last month, Manila raised $1.5 billion in what was Asia's first sovereign bond issue this year, covering its 2009 overseas debt requirement.

It also received around $1 billion in partial payment from a consortium that won the right to operate the country's power grid.

The central bank has said it expects the country's GIR to be at $37-37.5 billion by the end of the year, almost flat from last year, despite an expected slowdown in growth of remittance inflows.

Remittances, which form the backbone of the Philippine economy, are forecast to grow 3-6 percent this year, against an estimated 10 percent growth last year, because of the global economic crisis. With Reuters