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ECONOMY: Samoa’s Foreign Reserves now exceeds SAT$1.0 billion

Source: Central Bank of Samoa

APIA, SAMOA – 03 JULY 2023: Samoa’s foreign reserves as of May 2023 has recorded Tala $1.01 billion, and the Central Banks says this is “a historical high and reflecting a healthy external position for the Samoan economy to date.”

At this level, it was equivalent to 10.3 months of import cover, well above the minimum of 4.0 months of imports of goods that is considered sufficient and adequate for the viability of Samoa’s foreign reserves.

The country’s foreign exchange reserves are largely sourced from the inflow of official aid from Samoa’s development partners as well private sector inflows from tourism receipts, remittances and export earnings to name a few.

The valuable and ongoing assistance from Samoa’s development partners over the years, and particularly the last three years to assist with the Government’s COVID-19 response, the re-opening of Samoa’s international borders since August 2022 and the steady rebuilding of the tourism industry in addition to high private remittances, have contributed notably to the current level of official foreign reserves.

At the same time, given the high global downside risks, uncertainties relating to the pandemic and increasing challenges from external factors (such as the high costs of international commodity prices for imported fuel and food), the Central Bank of Samoa also maintained an adequate administration of Exchange Control measures to cushion significant payment outflows over the last few years.

Approximately 93 percent of the country’s official foreign exchange reserves remain well-diversified across the major reserve currencies, highly liquid and safely secured in various overseas banks, including other major central banks.

The other 7 percent represent the country’s holdings of Special Drawing Rights (SDR) and Reserve Fund Position with the International Monetary Fund.

Consistent with its mandate, the Central Bank will continue to prudently manage these holdings of foreign exchange reserves and ensure it is maintained at an adequate level to facilitate the country’s international obligations.