External debt indicators continued to improve in Q1: Espenilla

Bangko Sentral ng Pilipinas Governor Nestor A. Espenilla, Jr. announced that the Philippines’ outstanding external debt stood at US$73.2 billion as of end-March 2018, marginally higher (by US$98 million or 0.1 percent) than the end-2017 level of US$73.1 billion. (Photo By Bangko Sentral ng Pilipinas, CC BY-SA 4.0)

MANILA — Bangko Sentral ng Pilipinas Governor Nestor A. Espenilla, Jr. announced that the Philippines’ outstanding external debt stood at US$73.2 billion as of end-March 2018, marginally higher (by US$98 million or 0.1 percent) than the end-2017 level of US$73.1 billion.

The slight increase in the debt stock during the first quarter was brought about by: (a) positive foreign exchange (FX) revaluation adjustments (US$621 million), due largely from the weakened US Dollar against the Japanese Yen which pushed the debt stock higher by US$655 million (but peso depreciation against the US Dollar decreased the debt level by US$144 million); and (b) prior periods’ adjustments (US$685 million) due to late reporting.

These upward pressures on the debt stock were partially mitigated by: (a) net principal repayments (US$735 million), which resulted mainly from the bullet payments at maturity as well as prepayments by the private sector; and (b) transfer of holdings of Philippine debt papers issued offshore (US$472 million) by non-residents to residents.

Compared to the end-March 2017 figure, however, the debt stock declined year-on-year by US$609 million (or 0.8 percent) from US$73.8 billion due to net repayments (US$3.4 billion), primarily on the private sector’s short-term (ST) non-trade accounts. This downward impact on the debt stock was partly offset by: (a) previous periods’ adjustments (positive US$1.5 billion) due to late reporting; (b) upward FX revaluation adjustments (US$713 million); and (c) transfer of Philippine debt papers from residents to non-residents (US$618 million).

External debt refers to all types of borrowings by Philippine residents from non-residents, following the residency criterion for international statistics.