JAKARTA - Bank Indonesia (BI) recorded that Indonesia's external debt as of late October 2019 grew 11.9% year on year (yoy) to US$ 400.6 billion, consisting of public sector (government and central bank) external debt of US$ 202 billion and private sector (including SOEs) external debt of US$ 198.6 billion.

This growth was higher than the previous month's growth of 10.4% yoy, mainly due to the influence of net foreign debt withdrawal transactions and the strengthening of the rupiah exchange rate against the US dollar so that debt in rupiah was recorded higher in US dollar. In addition, the increasing external debt growth was also influenced by the increase in government external debt amid the decline in private external debt.

The position of government external debt as of late October grew 13.6% yoy to US$ 199.2 billion, higher than the previous month. The largest portion of government external debt was used to finance the health service and social activity sector with 19%, followed by construction with 16.5%; education services 16.1%; government administration, defence, and compulsory social security 15.3%; and financial and insurance services 13.4%.

Meanwhile, private external debt growth at the end of October was recorded at 10.5% yoy, slightly slower than the previous month's growth of 10.7% yoy. By sector, private external debt was dominated by the financial services and insurance sector; electricity, gas, hot steam/water and air supply; processing industry; and mining and quarrying.

In an official statement received by IDNFinancials.com on Monday (12/16), BI stressed that Indonesia's external debt structure remains healthy and is  supported by the application of the precautionary principle in its management. "This condition was reflected in, among others, the ratio of Indonesia's external debt to Gross Domestic Product (GDP) in October 2019 of 35.8%, better compared to the ratio in the previous month. In addition, Indonesia's external debt structure remains dominated by long-term external debt with a share of 88.4% of total external debt," BI wrote.

"In order to keep the external debt structure healthy, Bank Indonesia and the government continue to improve coordination in monitoring the development of external debt, supported by the application of the precautionary principle in its management." (MS)