External debt down slightly to $58 B

MANILA, Philippines - The country’s outstanding external debt stood at $58.1 billion as of June this year, the Bangko Sentral ng Pilipinas reported yesterday.

The figure was lower than the $58.3 billion recorded as of March this year but about the same as the $58 billion in the same period last year.

External debt refers to all types of borrowings by Philippine residents from non-residents that are approved by the central bank.

“The decline resulted mainly from repayments exceeding new borrowings by $593 million; and previous periods’ adjustments due to late reporting of transactions and audit findings,” the BSP said

“The effects of these developments were, however, partially offset by increased investments by non-residents in Philippine debt papers of $354 million, and foreign exchange revaluation adjustments of $266 million arising from the weakening of the dollar, particularly against the Japanese yen and the peso,” the central bank said.

The country’s external debt ratio or the capacity to meet maturing obligations  stood at 17.6 percent as of June when measured against the gross national income and at 21.2 percent based on gross domestic product.

Both were improvements from the 18.3 percent and 21.8 percent in the same period last year, respectively, as the Philippine economy continued to improve.

 “Major external debt indicators remained at comfortable levels at the end of the second quarter,” BSP Governor Amando M. Tetangco Jr. said.

The bulk or 83.5 percent of the outstanding foreign debt had medium to long-term maturities or those payable in more than a year. The remaining 16.5 percent were made up of short-term debt which included trade credits, inter-bank borrowings and deposit liabilities.

Public sector debt went up to $41 billion as of June from $40.8 billion in end-March, while private sector borrowings slid to $17.1 billion from $17.6 billion.

Multilateral and bilateral creditors had the largest exposure in the first quarter at 36.9 percent, while foreign holders of bonds and notes had an exposure of 36.8 percent. Foreign banks and other financial institutions had a 17.7 percent exposure, while foreign suppliers and exporters accounted for the remaining 8.6 percent.