RP GROSS INTERNATIONAL RESERVES CLIMB TO $16-BILLION

MANILA
, April 6, 2004
 (STAR)
By DES FERRIOLS - The country’s gross international reserves (GIR) went up to about $16 billion as of end-March as the National Government (NG) wrapped up its foreign borrowings for the year with its successful $200-million bond offer last month.

The Bangko Sentral ng Pilipinas (BSP) said yesterday that the GIR was also boosted by its $500-million borrowing also last month, rounding up the reserves above $16 billion against the $14-billion level projected for the first semester of the year.

BSP Governor Rafael B. Buenaventura said the increase was due to the combined borrowings of the NG and the BSP although he said the level is expected to taper off as the government settles its maturing obligations.

The $200-million borrowing of the NG was intended for the refinancing of its obligation while the $500-million borrowing of the BSP was earmarked for its reserves as well as refinancing.

The BSP originally planned to postpone its own borrowing until the second half of the year but Buenaventura said the opportunity came up for an attractive package last month.

Buenaventura explained that the GIR was officially projected to range between $14 and $15 billion for the whole of 2004.

For the first half of the year, however, low remittances from overseas Filipino workers as well as weak investments right before elections would cause a drop in the GIR to the lower end of this projected range.

"These are seasonal factors, particularly in the OFW remittances," Buenaventura explained. "It’s also understandable for foreign investments to be jittery since we’re building up towards the elections in the first half."

According to Buenaventura, it would take time RP forex… From B-1

for investors to regain confidence once the May elections is over and the new administration takes over regardless of who would win.

"Obviously, the dynamics would not return to normal until the second semester and by then, we expect some improvements in the inflows," Buenaventura said.


Reported by: Sol Jose Vanzi

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