Indonesia's International Investment Position Remained Solid in Q3: BI

Jakarta: Indonesia's International Investment Position (IIP) recorded a lower net liability in the third quarter of 2022, according to Bank Indonesia (BI).
 
At the end of the third quarter of 2022, Indonesia's IIP amassed a net liability totalling USD262.0 billion (20.0% of GDP), lower than USD270.5 billion (21.3% of GDP) net liability recorded in the previous quarter, stemmed from a decrease in the position of Foreign Financial Liabilities (FFL) amid a relatively stable Foreign Financial Assets (FFA) position. 
 
"Indonesia's FFL position decreased in line with the lower value of domestic financial instruments amid a continued direct investment inflows surplus," BI Communication Department Executive Director Erwin Haryono said in a media release on Monday.

The Indonesia's FFL position retreated 1.2% (qtq) from USD705.2 billion at the end of the second quarter of 2022 to USD696.8 billion at the end of the third quarter of 2022. 
 
"Indonesia's FFA position relatively stable," he added.
 
At the end of the third quarter of 2022, the FFA position recorded a USD434.7 billion, relatively stable compared to the second quarter of 2022. 
 
"Bank Indonesia views Indonesia's IIP in the third quarter of 2022 remained solid, thus supporting external resilience," he stated.
 
This was reflected by a maintained ratio of Indonesia's net liability IIP to GDP, decreasing from 21,3% to 20,0% in the reporting period.  
 
In addition, the structure of Indonesia's IIP liabilities also remains dominated by long-term maturity instruments (93.9%), primarily in the form of direct investment. 
 
"Moving forward, Bank Indonesia is confident that Indonesia's IIP performance will be maintained in line with efforts to foster economic recovery from the Covid-19 pandemic, supported by synergy between Bank Indonesia's policy mix, the Government and other relevant authorities policies. Nevertheless, Bank Indonesia will remain vigilant of the potential risks associated with a net liability IIP on the economy," he concluded.
 
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