No. 24/282/DKom
Indonesia's external debt position recorded a further decrease in August 2022. At the end of August 2022, the position of external debt in Indonesia stood at USD397.4 billion, down from USD400.2 billion in the previous month. The latest developments stemmed from lower debt positions recorded in the public sector (Government and Central Bank) and private sector. Annually, the external debt position recorded a deeper 6.5% (yoy) contraction in August 2022 after contracting 4.1% (yoy) the month earlier.
Government external debt maintained a downward trend in August 2022. The position of government external debt retreated to USD184.9 billion in August 2022 from USD185.6 billion in July 2022. Annually, government external debt recorded a deeper 10.9% (yoy) contraction in the reporting period compared with a 9.9% (yoy) contraction in July 2022. The lower government external debt position was attributable to a decrease of loan instruments as repayments exceeded disbursements to support the financing of priority programs and projects. Meanwhile, SBN instruments recorded a higher position in response to an increase of inflows to domestic SBN, reflecting maintained foreign investor confidence despite elevated global financial market uncertainty. The Government remains firmly committed to maintaining credibility by servicing principal and interest payments punctually, coupled with prudential, credible and accountable external debt management. External debt disbursements in August 2022 remained oriented towards productive sector financing and accelerating the national economic recovery. Government external debt support to fund productive sectors and priority expenditures in the reporting period targeted, amongst others, human health and social activities (24.5% of total government external debt), education (16.6%), public administration, defence and compulsory social security (15.2%), construction (14.2%) as well as insurance and financial services (11.7%). 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 downward trend in August 2022. The position of private external debt decreased to USD204.1 billion from USD206.1 billion in the previous month. Annually, private external debt experienced a deeper 2.0% (yoy) contraction in the reporting period after declining 1.2% (yoy) in July 2022. This was explained by 3.6% (yoy) and 1.6% (yoy) contractions in terms of external debt at financial corporations and non-financial corporations respectively, primarily due to a net payment on trade credit and other liabilities. 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; mining and drilling as well as the manufacturing industry, accounting collectively for 77.5% of total private external debt. Furthermore, 75.1% 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 August 2022, as reflected by a lower ratio of external debt to gross domestic product (GDP) from 30,7% in July 2022 to 30.4% in August 2022. In addition, the sound structure of external debt in Indonesia is dominated by long-term debt, accounting for 87.1% of the 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) October 2022 edition on the Bank Indonesia website. This publication can also be accessed through the Ministry of Finance website.
Jakarta, 17th October 2022
Communication Department
Junanto Herdiawan
Director
Information on Bank Indonesia
Tel. 021-131, email: bicara@bi.go.id
