Photo credit: BSP

The Bangko Sentral ng Pilipinas (BSP) recently dropped some numbers on the country's balance of payments (BOP) position for 2024, and it’s worth a quick dive.

So, here’s the scoop: the Philippines recorded a BOP surplus of USD609 million last year. Now, before we break out the confetti, let’s compare that to 2023, when the surplus was a hefty USD3.7 billion. Yup, that’s a noticeable drop.

For those who might need a refresher, the BOP basically sums up all the economic transactions between the Philippines and the rest of the world over a specific period. It gives us a snapshot of whether we’re bringing in more money than we’re spending (a surplus) or the other way around (a deficit).

According to the BSP, this dip in the surplus mainly comes down to a bigger trade deficit in goods, fewer net receipts from services trade, and less foreign borrowing by the national government. But, it’s not all gloomy. The decline was cushioned by solid net inflows from personal remittances and foreign investments—so there’s a silver lining!

And about our reserves? The gross international reserves (GIR) slid a bit to USD106.3 billion by the end of December 2024, from USD108.5 billion in November. However, this amount is still a robust buffer, enough to cover 7.5 months of imports and service payments, and about 3.7 times our short-term external debt. So, while we’re seeing a decline, we’re still in a pretty good place liquidity-wise.

In a nutshell, while the surplus isn’t as high as before, the country’s financial buffers remain solid. It’s a balancing act, but so far, the Philippines is holding steady.