JAKARTA (Yosefardi) – Indonesia’s International Investment Position (IIP) recorded a net liability of US$327.4 billion (37.8% of GDP) at the end of third quarter (Q3/2015), decreased US$41.7 billion (11.3%) from a net liability of US$369.1 billion (41.8% of GDP) at the end of Q2/2015.
The decrease in net liabilities of Indonesia’s IIP was caused by the decrease of Indonesia’s Foreign Financial Liabilities (FFL) position that was greater than the decrease of Indonesia’s Foreign Financial Assets (FFA) position.
Indonesia’s FFA position decreased US$4.4 billion or 2.1% (qtq) to US$210.1 billion at the end of Q3/2015. The decrease was mainly driven by the decrease of reserve assets and direct investment position (financial transactions).
In addition to the financial transactions, a decrease in FFA was also contributed by a negative revaluation due to the strengthening US Dollar against some other major currencies in FFA, such as the AUD, GBP and CHF.
Indonesia’s FFL position decreased USD46.1 billion or 7.9% (qtq) to USD537.5 billion at the end of Q3/2015. The decrease was mainly influenced by a net negative revaluation, even though there were also notable foreign inflows in the form of direct investment and other investments in the reporting period.
The net negative revaluation was caused by both correction of domestic stock prices as well as the strengthening US Dollar against Rupiah which impacted on the position of FFL.
Bank Indonesia views that the development of Indonesia’s IIP until Q3/2015 remained healthy.