RP foreign debt hits $54.6 billion end-March


Posted at Jun 30 2008 12:11 PM | Updated as of Jun 30 2008 08:11 PM

The country's outstanding foreign debt stood at $54.6 billion as of end-March 2008, slightly lower than the end-2007 level of $54.9 billion but higher than the $54 billion recorded a year ago, data from the Bangko Sentral ng Pilipinas revealed Monday.

External debt ratio or total outstanding debt as a percentage of aggregate output declined to 32.4 percent, from 35.0 percent in 2007 and 40.8 percent in March 2007. In terms of gross domestic product, the external debt ratio also improved to 35.5 percent, from 38.1 percent in 2007 and 44.2 percent in March 2007.

"The declining ratio indicates the country’s improving capacity to service its maturing foreign obligations," the BSP said in a statement.

The external debt service ratio or the percentage of total principal and interest payments to total exports of goods and receipts from services and income was estimated at 11.0 percent during the first quarter of 2008, down from 12.5 percent during the same period last year.

Gross international reserves, which continued to reach peak levels, stood at $36.6 billion as of end-March 2008. The amount is equivalent to 5.5 times the level of short-term debt based on the original maturity concept and 3.4 times the level of short-term debt based on the remaining maturity concept.

The maturity profile of the country’s external debt remained predominantly medium to long term, accounting for 87.8 percent of the total. These loans, with original tenors of more than one year, had a weighted average maturity of 19.7 years, longer than the 18.9 years recorded in December 2007. Public sector borrowings had an average term of 21.4 years, much longer than the private sector’s 11.3 years. Short-term external debt represented 12.2 percent of total.

Total consolidated public sector external debt rose to $40.1 billion, from last quarter’s $37.7 billion with share to total also rising to 73.5 percent from 68.6 percent in December 2007.

Private sector external debt dropped to $14.5 billion from US$17.3 billion in December 2007; share to total also declined to 26.5 percent from 31.4 percent.

Official creditors (consisting of multilateral institutions, such as the Asian Development Bank and the World Bank, and bilateral creditors mainly the Japan Bank for International Cooperation) accounted for 42.0 percent of the country’s total external debt, followed by foreign holders of bonds and notes at 35.1 percent, and foreign banks and other financial institutions, 15.5 percent. The rest of the creditors (7.4 percent) were mostly foreign suppliers.

US dollar-denominated accounts comprised more than half of the debt stock (50.7 percent) while Japanese yen-denominated accounts comprised 28.5 percent. Multi-currency loans from the Asian Development Bank and the World Bank comprised 9.6 percent, and the rest (11.2 percent) were in 16 other currencies.