PH, Japan Renew $12B Bilateral Swap Arrangement

The Philippines and Japan have renewed their Bilateral Swap Arrangement (BSA), maintaining a swap deal valued at up to $12 billion, effective January 1, 2025, the Bangko Sentral ng Pilipinas (BSP) announced on Monday.

Details of the Renewal

The renewal was formalized through the signing of the Fourth Amendment and Restatement Agreement of the Third BSA by the BSP and the Bank of Japan (BOJ).

The agreement allows both countries to swap their local currencies for US dollars. The Philippines can also exchange the Philippine peso for Japanese yen.

Access Limits

• Philippines: Access to $12 billion or its equivalent in Japanese yen.
• Japan: Access to up to $500 million.

Purpose and Benefits

The BSA aims to enhance financial cooperation between the two nations and support regional and global financial stability. It provides a financial safety net, ensuring quick access to foreign currency to:

• Enhance liquidity during times of economic stress.
• Mitigate exchange rate risks.
• Foster stronger economic ties.

“Japan and the Philippines believe that the BSA will further deepen financial cooperation and contribute to regional and global financial stability,” the BSP said in its statement.

This renewal underscores the continuing commitment of both nations to bolster financial stability and strengthen their partnership amidst global economic uncertainties.