THE Philippines’ balance of payments (BOP) remained in deficit in April but narrowed from month and year earlier, latest Bangko Sentral ng Pilipinas (BSP) data showed on Tuesday.
At $2.12 billion, the shortfall was lower than last year’s $2.56 billion and March’s $2.64 billion. It brought the year-to-date BOP to a $5.41-billion shortfall, lower than the $5.52 billion recorded in January-April 2025.
The BOP is a summary of a country’s transactions with the rest of the world for a specific period. It consists of the current account, which covers trade in goods, services and primary and secondary income (which includes overseas Filipino worker remittances); the capital account — capital transfers and nonfinancial assets; and the financial account or investments from abroad.
Philippine Institute for Development Studies senior fellow John Paolo Rivera said the narrower deficit suggested that pressures on the country’s external accounts could have started to ease.
This is “likely due to stronger inflows from remittances, services exports, foreign borrowings, and a possible moderation in import payments,” he said.
The Philippines ended 2025 with a $5.7-billion BOP deficit, reversing from 2024’s $609-million surplus. The central bank expects the shortfall to widen this year to $7.8 billion — higher than the $5.9-billion outlook three months earlier — and $8.5 billion in 2027.
The country’s gross international reserves (GIR), meanwhile, markedly dropped to $104.3 billion as of end-April from $105.3 billion a month earlier, the BSP also reported on Tuesday. It is the lowest recorded since January 2025’s $103.3 billion.
The central bank said the level was “a robust external liquidity buffer, equivalent to 6.9 months’ worth of imports of goods and payments of services and primary income.”
It is also equivalent to about 3.8 times the country’s short-term external debt based on residual maturity.
Rivera said the GIR decline meant that the BSP may have tapped part of its reserves to help stabilize peso volatility and cover external obligations.
“[The country’s] external position will remain sensitive to oil prices, global financial conditions and investor sentiment,” he added.
If geopolitical tensions persist, both BOP and reserves may stay under pressure, but the Philippines’ steady remittance inflows and services earnings should help keep the situation manageable.
The country ended last year with $110.8 billion in reserves, higher than the projected $109 billion. GIR is expected by the BSP to end 2026 at a higher $111 billion instead of $110 billion and rise to $112 billion next year.
GIR consists of the central bank’s foreign investments, gold, foreign exchange, reserve position in the International Monetary Fund and special drawing rights.
It helps “a country finance its imports and foreign debt obligations, stabilize its currency, and provide a buffer against external economic shocks,” the central bank said.
It is considered adequate if it can finance at least three months’ worth of the country’s imports of goods and payments of services and primary income.
It is also considered sufficient if it is enough to pay off all of the country’s foreign liabilities that will fall due in the next 12 months.
