REPUBLIKA.CO.ID, JAKARTA --- Indonesia's foreign debt has increased in February 2021, but it is considered that the increase is still under control. Bank Indonesia (BI) stated that both government-owned foreign money and private debt recorded an increase.

Indonesia's foreign debt in February 2021 remains under control, recorded at US$ 422.6 billion or Rp.6,166.13 trillion.

Head of the BI Communication Department, Erwin Haryono, said that the debt figure grew by 4.0 percent (yoy), higher than the growth in the previous month of 2.7 percent (yoy).

BI emphasized that the government's foreign debt remains under control and is managed in a measured and careful manner.

Government external debt grew by 4.6 percent on an annual basis (yoy), higher than growth in January 2021 of 2.8 percent (yoy).

The increase in foreign debt has occurred due to efforts to deal with the impact of the Covid-19 pandemic since 2020 and the acceleration of vaccination and social protection programs in the first quarter of 2021. These programs require large funds.

In meeting the 2021 APBN financing target, the government has a strategy, one of which is to prioritize and optimize domestic sources of financing. On the other hand, foreign sources of financing are used as a complement.

The Indonesian government prioritizes debt procurement with medium-long tenors, actively manages debt portfolios to control debt costs and risks.

The government also continues to manage debt in a measured and careful manner to support priority government spending. This expenditure includes, among others, the government administration, defense, and compulsory social security sectors (17.7 percent of total government foreign debt), the health services sector and social activities (17.2 percent), the education services sector (16.3 percent) , the construction sector (15.3 percent), and the financial services sector and insurance (12.7 percent).

The position of the Government of Indonesia's external debt in February 2021 reached 209.2 billion US dollars, lower than the previous month's position of 210.8 billion US dollars.

Private external debt remains dominated by long-term external debt. Private external debt growth was recorded at 3.4 percent (yoy), up from 2.5 percent (yoy) in the previous month.

This development was driven by the growth of non-financial institution company external debt (PBLK) of 5.9 percent (yoy), higher than the growth in the previous month of 5.1 percent (yoy).

Private debt is driven by the issuance of global corporate bonds in the mining sector. Financial institution debt contracted by 4.9 percent (yoy), lower than the contraction in the previous month of 6.1 percent (yoy).

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