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Indonesia's external debt position remained manageable in November 2022. At the end of the reporting period, the position of external debt in Indonesia stood at USD392.6 billion, with a 5.6% (yoy) contraction, continuing the contraction one month earlier of 7.6% (yoy). Such development stemmed from the external debt contraction of the public sector (Government and Central Bank) and private sector.
Government external debt maintained a downward trend. The position of government external debt was recorded at USD181.6 billion in November 2022, reflecting a shallower annual 10.2% (yoy) contraction compared with a 12.3% (yoy) decline the month earlier. The lower government external debt position was influenced by positive sentiment stemming from maintained global market confidence, which reassured foreign investors back to place portfolio investment in the form of domestic government securities (SBN). In addition, foreign loan disbursements were used to support priority programs and projects, including Covid-19 handling, infrastructure development as well as several other development programs and projects. External debt disbursements in November 2022 remained oriented towards supporting government priority expenditures, including Covid-19 handling measures and the national economic recovery program. The Government remains firmly committed to maintaining credibility by servicing principal and interest payments punctually, coupled with prudential, credible and accountable external debt management. Government external debt support to fund priority expenditures in the reporting period targeted, amongst others, human health and social activities (24.5% of total government external debt), education (16.5%), public administration, defence and compulsory social security (15.3%), construction (14.2%), as well as insurance and financial services (11.5%). The current position of government external debt is considered safe and manageable, with approximately 99.9% dominated by long-term maturities.
Private external debt also maintained a contractionary trend. The position of private external debt decreased 0.9% (yoy) to USD202.5 billion in November 2022, lower than the previous month with 3.0% (yoy) contraction. Such developments were explained by 2.0% (yoy) and 0.7% (yoy) contractions in terms of external debt at financial corporations and non-financial corporations respectively, compared with 3.4% (yoy) and 2.8% (yoy) contractions one month earlier. By sector, the main contributors to private external debt in the reporting period were insurance and financial services; electricity, gas, steam and air conditioning supply; the manufacturing industry; as well as mining and drilling, accounting collectively for 78.1% of total private external debt. Furthermore, 74.8% of total private external debt was dominated by long-term tenors.
The structure of external debt in Indonesia remains sound, supported by prudential management. External debt was still manageable in November 2022, as reflected by a ratio of external debt to gross domestic product (GDP) which maintained at 29.7%, up slightly from 29.5% in the previous period. In addition, the healthy structure of external debt in Indonesia is dominated by long-term debt, accounting for 87.0% of total external debt. Seeking to maintain a healthy structure, Bank Indonesia and the Government continued to strengthen coordination in terms of monitoring external debt, supported by the application of prudential principles, while optimising the role of external debt to support development financing and accelerate the national economic recovery, as well as minimise the risks that could impact economic stability.
Further information and metadata are presented in the publication of Indonesia's External Debt Statistics (SULNI) January 2023 edition on the Bank Indonesia website. This publication can also be accessed through the Ministry of Finance website.
Jakarta, 16th January 2023
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