Faisal Maliki Baskoro, Jakarta – Bank Indonesia (BI) announced that as of November 2023, Indonesia's foreign debt (ULN) has reached $400.9 billion (Rp 6,231 trillion), reflecting a 2.0 percent year-on-year growth, as global uncertainties start to alleviate.
Erwin Haryono, Head of the Central Bank Communications Department, said that the increase in external debt, which includes the government and private sector borrowings, was influenced by the depreciation of the dollar and the increase in government spending. In November 2023, The government's foreign debt amounted to $192.6 billion, showing a 6.0 percent year-on-year growth.
"Foreign debt increases as global financial uncertainties start to ease. The government remains dedicated to upholding credibility by ensuring prompt fulfillment of debt principal and interest payment obligations, while managing foreign debt cautiously, efficiently, and accountably," Erwin said.
He said that the government's foreign debt was mainly used to finance the government's priority programs and social safety nets, spanning diverse sectors.
These sectors include health and social activities (23.8 percent of foreign debt), government administration, defense, and mandatory social security (18.6 percent), education services (16.7 percent), construction (14.1 percent), as well as financial and insurance services (9.9 percent).
"The government's foreign debt position remains relatively safe and manageable, with almost 99.8 percent of the debt having long-term tenors, " he said.
Meanwhile, private sector foreign debt declined to $196.2 billion in November, experiencing a contraction of 3.2 percent year-on-year, deeper than the previous month's contraction of 2.3 percent year-on-year.
Financial corporations and non-financial corporations took fewer foreign loans this year, each experiencing contractions of 6.1 percent year-on-year and 2.5 percent year-on-year, respectively, deeper than the previous month's contractions of 2.4 percent year-on-year and 2.3 percent year-on-year.
The largest private sector foreign debt comes from the manufacturing industry, financial and insurance services, electricity, gas, steam/air conditioning supply, and mining and quarrying, accounting for 78.6 percent of total private sector foreign debt.
"Private sector foreign debt is still dominated by long-term foreign debt, accounting for 75.5 percent of total private sector foreign debt," he added.
Erwin said that Indonesia's overall foreign debt structure remains healthy as reflected in the foreign debt-to-GDP ratio at 29.3 percent, and predominantly consists of long-term debt, representing 87.1 percent of the total.