Jakarta (Indonesia Window) – Indonesia’s central bank, Bank Indonesia (BI), has noted that Indonesia's external debt in the fourth quarter of 2021 reached 415.1 billion U.S. dollars, down from 424 billion dollars in the previous quarter.

Head of BI’s Communications Department, Erwin Haryono, stated that the condition was caused by the decline in external debt in the public sector, consisting of the government and the central bank as well as the private sectors.

"On an annual basis, the position of external debt in the fourth quarter of 2021 contracted 0.4 percent (yoy) after growing 3.8 percent (yoy) in the previous quarter," he said here on Tuesday (Feb. 15).

The government’s external debt in quarter IV-2021 was recorded at 200.2 billion dollars, a decrease from 205.5 billion dollars in the previous quarter, or contracted 3 percent (yoy) after growing 4.1 percent (yoy) in the third quarter of 2021.

The decline in the external debt occurred in line with several series of the Government Securities maturing and the repayment of some of the principal loans in the fourth quarter of 2021.

In addition, the high volatility in global financial markets also contributed to the shift of investment from of the Government Securities to other instruments, thereby reducing the share of ownership by non-resident investors.

Meanwhile, the private external debt also declined, recorded at 205.9 billion dollars in the fourth quarter of 2021 from 209.3 billion dollars in the previous quarter, or contracted 0.9 percent (yoy) after growing 0.6 percent (yoy) from the previous quarter.

"This decrease is in line with the net payment of loans and other debts during the fourth quarter of 2021," Erwin said.

Bank Indonesia ensures that Indonesia's external debt remains under control in the fourth quarter of 2021, as reflected in the ratio of Indonesia's external debts to the GDP which is maintained at around 35 percent, a decrease compared to the ratio in the previous quarter of 37 percent.

In addition, the structure of Indonesia's external debt is also considered healthy, indicated by the dominant long-term external debts with a share of 88.3 percent of total external debts.

Reporting by Indonesia Window