Michelle Natalia
IDXChannel - Indonesia's International Investment Position (IIP) recorded a lower net liability in the second quarter of 2023, according to Bank Indonesia (BI).
At the end of the reporting period, Indonesia's IIP amassed a net liability totalling USD253.3 billion, down from a USD254.0 billion net liability posted at the end of the first quarter of 2023. The lower net liability IIP stemmed from a larger decrease in the position of Foreign Financial Liabilities (FFL) than the decrease in the position of Foreign Financial Assets (FFA).
"The lower FFL position was in line with a decline in external debt amid a maintained direct investment surplus. The FFL position retreated 0.6% (qtq) at the end of the second quarter of 2023 to USD716.0 billion from USD720.1 billion at the end of the first quarter of 2023," BI Communication Department Executive Director Erwin Haryono said in a media release on Monday (18/9/2023).
This was primarily driven by portfolio investment and other investment liabilities given payments on maturing debt securities and foreign loans. Meanwhile, the liability position of direct investment increased, reflecting investor optimism in the promising domestic economic outlook despite elevating global financial uncertainty.
The latest FFL developments were also influenced by the lower value of domestic financial instruments in response to decreasing stock prices and broad-based US Dollar appreciation against most global currencies, including the Rupiah.
