Philippine central bank announces renewal of BSA with Japan
(MENAFN) The Philippines and Japan have renewed their Bilateral Swap Arrangement (BSA), which became effective on January 1, 2025, according to an announcement from the Philippine central bank on Monday. The agreement was signed between the Bank of Japan, acting on behalf of the Minister of Finance of Japan, and the Bangko Sentral ng Pilipinas (BSP). The signing of the Fourth Amendment and Restatement Agreement of the Third BSA marks the continuation of this important financial arrangement.
The BSA is a two-way currency swap agreement that allows both countries' central banks to exchange their respective local currencies for U.S. dollars. This provides an essential mechanism for enhancing the liquidity and stability of their currencies, especially in times of economic stress or financial uncertainty. Additionally, the agreement also allows the Philippines to swap its local currency, the Philippine peso, for Japanese yen, further strengthening the bilateral financial ties between the two nations.
The BSP confirmed that the terms of the renewed agreement remain unchanged in terms of the maximum swap limits. Under the BSA, the Philippines can exchange up to 12 billion U.S. dollars or its equivalent in Japanese yen, while Japan can swap up to 500 million U.S. dollars for the Philippines. This arrangement is designed to enhance financial cooperation between the two countries and promote stability in their respective economies.
This renewal underscores the commitment of both countries to deepen their economic and financial collaboration, which has proven vital in supporting regional financial stability. The BSA provides both nations with a crucial tool to manage liquidity during times of need and strengthen their overall economic resilience.
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