Tonga's Foreign Reserves comfortable for now [1]
Wednesday, February 6, 2013 - 15:55. Updated on Monday, September 9, 2013 - 18:40.
Foreign Reserves held by the National Reserve Bank of Tonga rose by $3.6 million, from $253.7 million in November to $257.3 million in December, or 9.3 months of imports.
Official Foreign Reserves in December 2012 showed a significant growth, with a $31.3 Million increase compared to December 2011.
A statement from the NRBT attributes the December rise to receipts from private remittances and official capitals inflows which have “more than offset import payments”.
Propped-up
However, in a presentation to the the Tonga Chamber of Commerce and Industries, last week, the Reserve Bank Governor, Joyce Mafi, said she believed that the Foreign Reserves were currently overstated.
"The continuing increase in Foreign Reserves has been propped up by development partner’s funds," she said, including government salaries which were now supported by funds sent from overseas.
The outlook was for Foreign Reserves to remain, "comfortably high, though declining toward the end of 2013 when the Government starts paying off the China Loan, expected in September," she said.
"The other issue is that there a lot of deferred payments, especially large companies like oil. We have more than five months' worth of oil imports received and used, that has to be paid for, and has not been paid for, so we can say the reserves are relatively overstated," Joyce told the chamber of commerce.