Indonesia's External Debt Still Manageable in May 2024

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​No. 26/140/DKom

Indonesia's external debt remained manageable in May 2024. The position of external debt in Indonesia in May 2024 was recorded at USD407.3 billion, growing 1.8% (yoy) after contracting 1.5% (yoy) in April 2024. The latest developments stemmed from the public sector, which comprises the government and central bank, as well as the private sector.

Government external debt remained under control.The position of government debt in May 2024 stood at USD191.0 billion, recording an annual contraction of 0.8% (yoy) after contracting 2.6% (yoy) in April 2024. The latest developments were primarily attributable to an influx of foreign capital inflows to international and domestic Government Securities (SBN) in line with positive sentiment given investor confidence in the promising Indonesian economic outlook. The Government remains firmly committed to preserving credibility in servicing principal and interest payments promptly, as well as managing external debt prudently with flexibility and strategic opportunism to secure the most efficient and optimal financing. External debt, as a component of State Revenue and Expenditure Budget (APBN) financing instruments, is consistently geared towards supporting government efforts to finance priority and productive sectors, including human health and social activities (21.0% of total government external debt); public administration, defence and compulsory social security (18.7%); education (16.8%); construction (13.6%); as well as insurance and financial services (9.5%), among others. The current state of government external debt is considered relatively safe and manageable, with nearly all, or 99.99% of total government external debt, dominated by long-term maturities.

Private external debt also remained manageable.The position of private external debt in May 2024 was recorded at USD197.6 billion, tracking an annual contraction of 0.4% (yoy) after declining 2.8% (yoy) in April 2024. The decline was observed in financial corporations, which contracted 2.6% (yoy) in the reporting period. Concurrently, the position of non-financial corporations external debt increased by 0.1% (yoy). By sector, the main contributors to private external debt in the reporting period were the manufacturing industry; insurance and financial services; electricity and gas; as well as mining and quarrying, collectively accounting for 78.9% of total private external debt. Furthermore, 76.1% of total private external debt was dominated by long-term tenors.

The structure of external debt in Indonesia remains sound, supported by prudential management.Such developments were reflected in a 29.8% external debt to gross domestic product (GDP) ratio, with long-term debt dominating 85.9% of total external debt. Seeking to maintain a healthy structure, Bank Indonesia and the Government will continue strengthening inter-agency coordination to monitor external debt developments. The function of external debt will also be optimised to support development financing and nurture sustainable economic growth nationally by minimising the risks that could disrupt economic stability.

The latest external debt data and metadata are presented in the publication of Indonesia's External Debt Statistics (SULNI) July 2024​ edition on the Bank Indonesia website. This publication can also be accessed via the Ministry of Finance website.

Jakarta 15thJuly 2024​​

Communication Department

Erwin Haryono

Assistant Governor​

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