Philippines records $2B BOP deficit in March

The Philippines recorded a $2 billion balance of payments (BOP) deficit in March this year, reversing the $1.2 billion surplus in March 2024.

This development reflects the national government's drawdowns on its foreign currency deposits with the Bangko Sentral ng Pilipinas (BSP) to meet external debt obligations and the central bank’s net foreign exchange operations.

Year-to-date, there has been a $3 billion deficit compared to a $238 million surplus in the first quarter of 2024.

The decline is partly due to the widening trade in goods deficit, although it was partially offset by continued inflows from personal remittances, foreign direct investments, and foreign borrowings by the national government.

By the end of March 2025, the country's gross international reserves (GIR) decreased slightly to $106.7 billion from $107.4 billion at the end of February, but remain substantial, providing a buffer equivalent to 7.4 months' worth of imports and services payments.

The BSP forecasted a $4-billion BOP deficit for the year 2025, which is equivalent to 0.8 percent of gross domestic product (GDP), highlighting the need to maintain adequate reserves to support economic resilience against external shocks.