The government’s foreign debt is considered safe and manageable, with almost all of it being long-term, comprising 99.99 percent of the total government foreign debt.

Private sector foreign debt also remained under control at $197.6 billion in May 2024, showing a yearly contraction of 0.4 percent, following a 2.8 percent contraction in April 2024. This contraction is primarily due to the financial corporations’ sector, which saw a 2.6 percent yearly contraction. Meanwhile, non-financial corporations’ foreign debt grew by 0.1 percent yoy.

The largest portion of private sector foreign debt comes from the manufacturing, financial services and insurance, electricity and gas supply, and mining sectors, comprising 78.9 percent of total private sector foreign debt. Long-term debt dominates the private sector foreign debt structure, accounting for 76.1 percent.

To ensure the continued health of the foreign debt structure, Bank Indonesia and the government are strengthening their coordination in monitoring foreign debt developments. They aim to optimize the role of foreign debt in supporting development financing and promoting sustainable national economic growth while minimizing risks that could affect economic stability. (Uki Ruknuddin)