The Indonesia’s external debt grew 8.7% (yoy), higher than 7.9% (yoy) in March 2019 due to net withdrawals external debt and the strengthening rupiah against US dollar resulted in a more significant amount of rupiah debt in terms of US dollar.
"The increase of total external debt growth originated from private external debt, amid a slowing growth of government external debt," Bank Indonesia (BI) said in a press statement releaded on Monday.
Government external debt growth slowed down. As of end-April 2019, government external debt amounted to USD186.7 billion, recorded a slower growth of 3.4% (yoy) compared to 3.6% (yoy) in the previous quarter.
The decline was induced by debt repayments totaling USD0.6 billion as well as capital outflows to the domestic Government Securities (SBN) market amounted to USD0.4 billion following the global financial market uncertainty as trade tensioned escalated.
Government external debt management is prioritized to finance development, dominated in productive sectors to promote growth as well as improving public welfare, among others, human health & social work activities sector (18.8% of government external debt), construction sector (16.3%), education sector (15.8%), public administration & defense sector (15.1%), and financial & insurance sector (14.4%).
Private external debt growth increased. The private external debt position as of end-April 2019 grew 14.5% (yoy), up from 13.0% (yoy) in the previous month.
The debt was dominated by the financial & insurance sector, manufacturing sector, electricity, gas, & water supply sector, and mining & drilling sector, with the share to total private external debt reached 75.2%.
Indonesia's external debt maintained a solid structure. This condition was reflected, among others, from Indonesia's external debt ratio to Gross Domestic Product (GDP) relatively stable at 36.5% as of end-April 2019, compared with conditions in the previous period.
In addition, the structure of Indonesia's external debt remained primarily dominated by long-term debt, accounted for 86.2% of the total external debt. Thus, despite the rise of Indonesia's external debt, it was manageable with a solid structure.
"Bank Indonesia, in close coordination with the government, continues to monitor external debt and to optimize the external debt's role in supporting development financing without incurring the risks that may affect macroeconomic stability," the central bank noted.