Monday, 17 June 2019 | 12:09 WIB

BI: Indonesia’s International Investment Position Has Risen

BI: Indonesia's International Investment Position Has Risen (harianmercusuar)

JAKARTA, NETRALNEWS.COM - Indonesia's central bank, Bank Indonesia (BI), has noted that Indonesia's International Investment Position (PII) at the end of 2018 experiencing an increase in net liabilities, driven by a rise in the position of Foreign Financial Liabilities (KFLN).

At the end of fourth quarter of 2018, PII Indonesia recorded a net liability ofUS $317.8 billion (30.5% of GDP), an increase from the net position of liabilities at the end of Q3 2018 which was recorded at $292.5 billion (28.0% of GDP).

"The increase in net obligations of PII Indonesia was due to an increase in the position of the KFLN which was greater than the increase in the position of Foreign Financial Assets (AFLN)," BI said in an official statement in Jakarta on Friday (3/22/2019).

The increase in Indonesia's KFLN position, which was mainly driven by the large inflow of foreign capital in the form of direct investment and portfolio investment, was a reflection of high investor confidence in the outlook for the domestic economy.

At the end of IV quarter 2018, the KFLN position rose 5.0% (qtq) or $31.9 billion to $664.8 billion.

He explained, the increase in KFLN's position was also influenced by other changes such as a positive revaluation of the value of domestic financial assets in line with the increase in the Jakarta Composite Index (JCI) and the weakening of the US dollar against the rupiah which resulted in an increase in rupiah-denominated investment instruments.

Indonesia's AFLN position also increased mainly driven by AFLN acquisition transactions in the form of foreign exchange reserves.

The AFLN position at the end of the fourth quarter of 2018 was recorded to have increased by 1.9% (qtq) or by $6.5 billion to $347.0 billion.

Further increases in the AFLN position were held back by other changes such as the negative revaluation of the AFLN, in line with the decline in the AFLN placement index average and the strengthening of the US dollar against several major currencies.