No. 25/128/DKom
Indonesia's external debt remained manageable in the first quarter of 2023. The position of external debt in Indonesia at the end of the first quarter of 2023 was recorded at USD402.8 billion, contracting 1.9% (yoy) after recording a 4.1% (yoy) contraction in the previous quarter. The contraction stemmed from the public sector (Government and Central Bank) as well as the private sector. The external debt position recorded in the first quarter of 2023 was also influenced by change factors driven by broad-based US Dollar depreciation against most global currencies, including the Rupiah.
Government external debt continued to track a contractionary trend. In the first quarter of 2023, government external debt experienced a shallower 1.1% (yoy) contraction to USD194.0 billion after declining 6.8% (yoy) in the previous period. The latest developments were driven by portfolio investment placements in the domestic government securities (SBN) market in response to sustained positive global market sentiment. In addition, the Government also recorded a net withdrawal of multilateral foreign loans to finance various programs and projects. The withdrawal of government external debt in the reporting period was prioritized to finance productive sectors and priority expenditures, specifically to maintain national economic recovery momentum against global economic uncertainty. The Government remains firmly committed to maintaining prudential, efficient, and accountable external debt management, as well as preserving credibility in promptly servicing principal and interest payments. By sector, government external debt encompasses human health and social activities (24.1% of total government external debt), public administration, defence and compulsory social security (17.9%), education (16.8%), construction (14.2%), as well as insurance and financial services (10.2%), amongst others. The current position of government external debt is considered safe and manageable, with 99.9% of total government external debt dominated by long-term maturities.
Private external debt also recorded a contraction and further decline. The position of private external debt contracted 3.0% (yoy) to USD199.4 billion in the first quarter of 2023 after contracting 1.7% (yoy) in the previous period. Such developments were underpinned by external debt at non-financial and financial corporations, which experienced deeper 2.9% (yoy) and 3.5% (yoy) contractions respectively compared with 1.4% (yoy) and 2.7% (yoy) contractions in the fourth quarter of 2022. By sector, the main contributors to private external debt in the reporting period were insurance and financial services, the manufacturing industry, electricity, gas, steam and air conditioning supply, as well as mining and quarrying, accounting collectively for 77.9% of total private external debt. Furthermore, 75.4% 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 the first quarter of 2023, as reflected by a stable ratio of external debt to gross domestic product (GDP) maintained at 30.1%. In addition, the sound structure of external debt in Indonesia is dominated by long-term debt, which accounted for 87.6% of total external debt in the reporting period. 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) May 2023 edition on the Bank Indonesia website. This publication can also be accessed through the Ministry of Finance website.
Jakarta, 15th May 2023
Communication Department
Erwin Haryono
Executive Director
