Bank Indonesia Reports Decline in Net International Investment Liabilities in Q1 2025
Jakarta (ANTARA) - Bank Indonesia (BI) reported that Indonesia's international investment position (IIP) in the first quarter of 2025 recorded a decline in net liabilities to 224.5 billion US dollars, down from 245.7 billion US dollars at the end of the fourth quarter of 2024.
"The decrease in net liabilities stemmed from an increase in the position of External Financial Assets (AFLN) and a decline in the position of External Financial Liabilities (KFLN)," said BI's Executive Director of the Communications Department, Ramdan Denny Prakoso, in an official statement in Jakarta on Wednesday.
Ramdan further conveyed that Indonesia's AFLN position increased, driven by greater resident investment in various external financial instruments. The AFLN position at the end of Q1 2025 was recorded at 533.1 billion US dollars, up 1.9 per cent quarter-on-quarter from 523.1 billion US dollars at the end of Q4 2024.
Nearly all AFLN components recorded increases in overseas placement transactions, with the largest rise in other investment assets, particularly in the form of loans and trade receivables. The increase in the AFLN position was further supported by the weakening of the US dollar against the majority of global currencies and rising international gold prices.
Meanwhile, Indonesia's KFLN position declined amid solid foreign capital inflows in direct investment and portfolio investment. Indonesia's KFLN position at the end of Q1 2025 was recorded at 757.6 billion US dollars, down 1.5 per cent quarter-on-quarter from 768.8 billion US dollars at the end of Q4 2024.
Direct investment continued to record a surplus, reflecting sustained investor optimism regarding the domestic economic outlook. Portfolio investment also recorded net foreign capital inflows amid heightened global financial market uncertainty.
The KFLN position was further influenced by a decline in the value of domestic financial instruments in line with a drop in the Jakarta Composite Index (IHSG).
Bank Indonesia considers that Indonesia's IIP developments in Q1 2025 remained well-maintained, thereby supporting external resilience. This is reflected in the ratio of Indonesia's IIP to gross domestic product (GDP) in Q1 2025 at 16.0 per cent, lower than 17.6 per cent in Q4 2024.
Additionally, the structure of Indonesia's IIP liabilities is dominated by long-term instruments (91.9 per cent), primarily in the form of direct investment.
Looking ahead, BI will continue to monitor global economic dynamics that may affect Indonesia's IIP outlook and will strengthen its policy mix response, supported by close policy synergy with the government and relevant authorities, to bolster external sector resilience. Furthermore, BI will continue to monitor potential risks related to IIP net liabilities on the economy.
"The decrease in net liabilities stemmed from an increase in the position of External Financial Assets (AFLN) and a decline in the position of External Financial Liabilities (KFLN)," said BI's Executive Director of the Communications Department, Ramdan Denny Prakoso, in an official statement in Jakarta on Wednesday.
Ramdan further conveyed that Indonesia's AFLN position increased, driven by greater resident investment in various external financial instruments. The AFLN position at the end of Q1 2025 was recorded at 533.1 billion US dollars, up 1.9 per cent quarter-on-quarter from 523.1 billion US dollars at the end of Q4 2024.
Nearly all AFLN components recorded increases in overseas placement transactions, with the largest rise in other investment assets, particularly in the form of loans and trade receivables. The increase in the AFLN position was further supported by the weakening of the US dollar against the majority of global currencies and rising international gold prices.
Meanwhile, Indonesia's KFLN position declined amid solid foreign capital inflows in direct investment and portfolio investment. Indonesia's KFLN position at the end of Q1 2025 was recorded at 757.6 billion US dollars, down 1.5 per cent quarter-on-quarter from 768.8 billion US dollars at the end of Q4 2024.
Direct investment continued to record a surplus, reflecting sustained investor optimism regarding the domestic economic outlook. Portfolio investment also recorded net foreign capital inflows amid heightened global financial market uncertainty.
The KFLN position was further influenced by a decline in the value of domestic financial instruments in line with a drop in the Jakarta Composite Index (IHSG).
Bank Indonesia considers that Indonesia's IIP developments in Q1 2025 remained well-maintained, thereby supporting external resilience. This is reflected in the ratio of Indonesia's IIP to gross domestic product (GDP) in Q1 2025 at 16.0 per cent, lower than 17.6 per cent in Q4 2024.
Additionally, the structure of Indonesia's IIP liabilities is dominated by long-term instruments (91.9 per cent), primarily in the form of direct investment.
Looking ahead, BI will continue to monitor global economic dynamics that may affect Indonesia's IIP outlook and will strengthen its policy mix response, supported by close policy synergy with the government and relevant authorities, to bolster external sector resilience. Furthermore, BI will continue to monitor potential risks related to IIP net liabilities on the economy.