BOP maintains surplus in 2024 despite challenges

The Philippines maintained a balance of payments (BOP) surplus of $609 million in 2024, reflecting the country's strong external position despite global economic uncertainties, according to the Bangko Sentral ng Pilipinas (BSP).

While lower than the $3.7 billion surplus recorded in 2023, the country’s external sector remained resilient, supported by sustained foreign investment inflows, stable remittances, and a robust gross international reserves (GIR) level.

The BSP reported that the financial account posted net inflows of $17.6 billion, a nearly 30 percent increase from the previous year’s $13.6 billion, driven by a surge in foreign borrowing and investments in the country.

"The increase in financial inflows was fueled by a shift in the portfolio investment account to net inflows from net outflows, along with higher net inflows in the direct investment account," the BSP stated.

Additionally, the country’s GIR strengthened to $106.3 billion by the end of 2024, up from $103.8 billion in 2023, providing a solid buffer equivalent to 7.3 months' worth of imports and supporting the peso's stability.

Although the current account deficit widened to $17.5 billion due to a larger trade-in-goods shortfall, this was partially offset by higher net receipts in the primary and secondary income accounts. The capital account also remained positive, with net receipts of $72 million.

In the fourth quarter of 2024, the BOP reflected a temporary deficit of $4.5 billion, largely attributed to a widening trade gap. However, the overall annual surplus and growing financial inflows indicate investor confidence and a steady external position.

The BSP remains optimistic about the country's external outlook, citing ongoing investment inflows, robust remittances, and a well-diversified economic base that continues to attract foreign capital.