Indonesia’s external debt growth continued to slow in October 2013. Debt grew 5.8 percent (yoy) to USD $262.4 billion compared to 8.6 percent (yoy) growth in the previous month. Slowing growth in external debt occurred both in the public and private sector. Public sector external debt position at the end of October 2013 grew 0.5 percent (yoy) to USD $125.8 billion compared to 2.1 percent (yoy) in September. Meanwhile, private sector external debt grew steadily at 11.1 percent (yoy) to USD $136.6 billion as compared to the previous month.
By maturity, long-term debt continued to dominate Indonesia’s external debt in October 2013. The majority of Indonesia’s external debt is long-term debt, amounting to USD $216.1 billion (82.4 percent of total external debt), while USD $46.3 billion (17.6 percent of total external debt) is short-term debt. Long-term external debt in October 2013 grew by 5.1 percent (yoy), higher than 4.2 percent (yoy) growth in the previous month. Meanwhile, short-term external debt grew by 8.8 percent (yoy), lower 19.2 percent (yoy) in September 2013. Long-term external debt of the public sector amounted to USD $118.8 billion (94.4 percent of total public sector external debt). Meanwhile, long-term private sector external debt reached USD $97.4 billion (71.3 percent of total private sector external debt).
Most of Indonesia's private sector external debt is attributable to the non-bank private sector, which reached 83.8 percent, while the external debt of banks is only 16.2 percent. The three biggest economic sectors incurring external debt are 1) finance, leasing, and business services, 2) manufacturing, and 3) mining and quarrying sectors. Of the creditors, most of the private sector external debt (34.8 percent of total private sector external debt) is owed to affiliates. Private sector external debt, both to affiliates and non-affiliates, grew by 11.0 percent (yoy) in October 2013.
Indonesia's central bank (Bank Indonesia) believes that moderate growth in Indonesia’s external debt is in line with the downturn in the domestic economy. In October 2013, the ratio of external debt to GDP stood at 29.5 percent and remained secure based on the international practice. Going forward, Bank Indonesia expects slowing growth in external debt will still continue in the future while closely monitoring the development of Indonesia’s external debt, particularly the short-term private external debt, in order to optimally support the Indonesian economy.
Source: Bank Indonesia