PH, Japan renew $12-billion currency swap deal

The central banks of the Philippines and Japan have renewed their Bilateral Swap Arrangement (BSA), keeping the agreement at a value of up to $12 billion, effective January 1, 2025, according to a statement from the Bangko Sentral ng Pilipinas (BSP).

The renewal was sealed with the signing of the Fourth Amendment and Restatement Agreement of the Third BSA by the BSP and the Bank of Japan (BOJ).

This arrangement enables both nations to exchange their local currencies for US dollars. Additionally, the Philippines can swap its peso for Japanese yen, allowing access to $12 billion or its equivalent in yen, while Japan can tap up to $500 million.

“The Philippines and Japan believe the BSA strengthens and complements other financial safety nets, fostering deeper financial cooperation and contributing to both regional and global financial stability,” the BSP stated.

The agreement is designed to provide rapid access to foreign currency, bolstering liquidity and stability during economic challenges. It also minimizes exchange rate risks, supports financial resilience, and strengthens economic partnerships between the two countries.