​No.23/301/DKom

Indonesia's external debt in Q3/2021 remained manageable. The external debt position at the end of Q3/2021 was recorded at USD423.1 billion or grew by 3.7% (yoy), higher than 2.0% (yoy) in the previous quarter. Such development was primarily driven by the accelerated growth of the public sector dan private external debt.

The Government's external debt decelerated from the previous quarter. In Q3/2021, the Government's external debt amounted to USD205.5 billion or grew 4.1% (yoy), decelerating from 4.3% (yoy). Such developments were due to the net payments of foreign loan as the maturing loans were higher than loan withdrawals. This happened amidst the issuance of Global Bonds, including the Sustainable Development Goals (SDG) Bond of 500 million Euros, one of Asia's first conventional SDG Bond issuances. The SDG Bond's issuance demonstrates Indonesia's efforts to support sustainable financing and a significant leap towards achieving the SDGs. The Government external debt is managed in a prudent, credible, and accountable manner to support the Government's spending towards priority sectors, including accelerating the National Economic Recovery (PEN) program, covering public administration, defense, & compulsory social security sector (17.9% share of Government's external debt),  human health & social work activities sector (17.3%), education sector (16.5%), construction sector (15.5%), and financial and insurance sector (12.1%). Regarding refinancing risk, the Government's external debt position remains safe since most of it consists of long-term debt, which accounted for 99.9% of the total Government's external debt.

Central Bank's external debt increased from the previous quarter but did not incur an additional debt interest burden. Compared with Q2/2021, the Central Bank's external debt position rose by USD6.3 billion to USD9.1 billion, primarily in the form of Special Drawing Rights (SDR)[1] allocation. The IMF distributed additional SDR allocation to all member countries, including Indonesia, proportionally on August 2021 to support global economic resilience and stability affected by the Covid-19 pandemics, build confidence, and strengthen long-term global reserves. The allocation of SDRs from IMF is a particular instrument and not categorized as loans from the IMF since it does not incur additional debt interest burden and obligation that will mature in the future.

The private sector's external debt increased from the previous quarter. The private sector's external debt grew by 0.2% (yoy) after experiencing a 0.3% (yoy) contraction in the previous quarter. Such development was attributable to nonfinancial corporations' external debt, which grew moderated to 1.0% (yoy) from 1.6% (yoy) in Q2/2021. Meanwhile, the financial corporation's external debt experienced a 2.7% (yoy) contraction, down from 6.9% (yoy) contraction in the last quarter. With these developments, the private sector's external debt position registered USD208.5 billion in Q3/2021. Several sectors with the most significant external debt, namely the financial & insurance sector; electricity, gas, steam, and air conditioning sup ply sector; mining and drilling sector; and manufacturing sector,  accounted for 76.4% of total private external debt. The private's external debt was still dominated by long-term external debt, which accounted for 76.1% share of total private's external debt.

The structure of Indonesia's external debt remained healthy, supported by the prudential principle application in its management. Indonesia's external debt in Q3/2021 remained manageable, as reflected in Indonesia's external debt to Gross Domestic Product (GDP) ratio at around 37.0%, lower than 37.5% in the previous quarter.  In addition, Indonesia's external debt structure remained healthy, which was indicated by the domination of long-term debt with an 88.2% share of total external debt. In close coordination with the government, Bank Indonesia monitors external debt by promoting the prudential principle application in its management to maintain a solid external debt structure. External debt's role will also be optimized in supporting development financing and stimulating national economic recovery by minimizing the risks that may affect macroeconomic stability.

The complete data on the latest Indonesia's external debt and its metadata can be obtained in the publication of Indonesia's External Debt Statistics (SULNI) November 2021 edition on the Bank Indonesia website. This publication can also be accessed through the Ministry of Finance website.

Jakarta, 15th November 2021

Head of Communication Department

Erwin Haryono

Executive Director

Information about Bank Indonesia

Tel. 021-131, Email: bicara@bi.go.id

[1] See the press release of Indonesia's External Debt Statistics for October Edition (August 2021 data) published on October 15, 2021