Philippine foreign reserves expected to hit 26 bln USD in 2007

The Philippines' foreign reserves are expected to rise to 26 billion U.S. dollars by the end of the year, thanks to strong inflows from foreign investments, government borrowing and remittances from overseas Filipino workers, the central bank said on Friday.

At the end of March, foreign reserves were at 24.7 billion U.S. dollars, which were equivalent to 4.6 months worth of imports of goods and payments of services, the Bangko Sentral ng Pilipinas ( BSP) or the Philippine central bank said in a report.

The remittances rose to 1.1 billion U.S. dollars in February, the 10th straight month that inflows have breached 1 billion, the BSP said.

The BSP said total remittance inflows through official channels are expected to reach 14 billion U.S. dollars this year, a new record and 10 percent higher than that of last year.

BSP Governor Amando Tetangco told reporters that the strong gross international reserves (GIR) in 2007 would be boosted by the return of development program loans from official development assistance (ODA) sources such as the Asian Development Bank (ADB) and the World Bank (WB).

Foreign investments are also expected to bring in more foreign exchange this year, the BSP added. It has projected net foreign direct investments to reach 2.119 billion U.S. dollars in 2007, much higher than the 1.895 billion target for 2006.

As the Philippine peso continued to appreciate, the BSP said that it would go on with building up its reserves this year. The country's GIR hit a record high of 23 billion U.S. dollars in 2006.

Source: Xinhua