Macro Note:Indonesia,External Debt Looks Manageable

External debt, classified here as liabilities owed to non-resident by residents of Indonesia (whichis in line with IMF’s guideline on External Debt Statistics), is an important indicator that wemonitor as it could foretell one of the potential external vulnerability risks to the Indonesianeconomy. At its worst, it could also pose risks of derailing the real economy if not monitored andmanaged accordingly.

    Indonesia’s external debt grew close to 5% yoy to reach USD341.5bn (Figure 1) as of the end ofOctober 2017, driven by higher external liabilities of private sector (banks, non-banks financialinstitution, and non-financial corporations) and public sector (government and central bank). Theprivate sector external debt grew steadily at 1.3% yoy (USD168.3bn) while the public sectorexternal debt grew 8.4% (USD173.2bn). Based on the original maturity, Indonesian externaldebt’s composition is still unchanged, which was dominated by long-term external debtaccounting for 86.3% of total external debt and grew 3.9% yoy. The remaining share thataccounts for the short-term external debt grew 10.6% (yoy) in October 2017. The profile of trendis similar for that based on remaining maturity of Indonesia’s external debt.