The Philippines’ balance of payments (BOP) position recorded a surplus of $609 million in 2024, lower than $3.7 billion in 2023 due to larger current account deficit.
Data from the Bangko Sentral ng Pilipinas showed that the current account deficit widened by 41.4 percent to $17.5 billion, equivalent to -3.8 percent of the gross domestic product in 2024 from $12.4 billion or -2.8 percent of GDP in 2023.
“The higher current account deficit emanated from lower net receipts in trade in services and a higher deficit in trade in goods. However, this was offset partly by higher net receipts in the primary and secondary income accounts,” the BSP said.
The capital account recorded net receipts amounting to $72 million in 2024, which was 2.9 percent lower than $74 million recorded in 2023. This developed on the back of lower net receipts in the national government’s other capital transfers at $67 million from $70 million.
The financial account posted $17.6 billion net inflows, or net borrowing by residents from the rest of the world, in 2024, higher by 29.6 percent than $13.6 billion net inflows in 2023. This was driven by the reversal of the portfolio investment account to net inflows from net outflows and higher net inflows in the direct investment account.
Meanwhile, the gross international reserves (GIR) amounted to $106.3 billion as of end-2024. This was higher than $103.8 billion level registered as of end-2023.
The peso averaged at 58.15 against the US dollar in the fourth quarter of 2024, depreciating by 1.5 percent from an average of 57.25 in the third quarter.
The BSP said the peso also depreciated 3.6 percent year-on-year from an average of 56.06 in the fourth quarter 2023.
“For the full year of 2024, the peso averaged 57.29/ $1, reflecting a 2.9-percent depreciation from the 2023 average of 55.63/ $1,” the BSP said.
The BSP said the BOP swung to a $4.5-billion deficit in the fourth quarter of 2024, a sharp reversal from the $1.9-billion surplus recorded in the same period of 2023.
It said the shift to a BOP deficit was driven by the increase in current account deficit and reversal to net outflows in the financial account. The current account deficit in the fourth quarter of 2024 amounted to $4.6 billion, higher by 339.3 percent than the $1-billion deficit in the same period in 2023.
“The increased deficit was driven by a larger merchandise trade gap and lower net receipts in trade in services and primary income accounts. However, this was partially offset by higher net receipts in the secondary income account,” the BSP said.