PH external debt up as of Q3

THE country’s outstanding external debt totaled $82.67 billion as of the third quarter of 2019, up from end-June and a year earlier, data from the Bangko Sentral ng Pilipinas (BSP) showed over the weekend.

It was $1.4 billion more than the $81.3 billion recorded three months earlier, largely attributed to net availments of $2.2 billion attributed to bond issuances of the national government and private local banks.

“Increase in residents’ investments in Philippine debt papers issued offshore amounting to $426 million, negative foreign exchange revaluation of $211 million, and prior periods’ adjustments of $114 million partially offset the uptick in the debt stock,” the central bank said in a statement.

From a year ago, the debt stock increased by $6.3 billion brought about by $5 billion net availments, $1.2 billion foreign exchange revaluation adjustments, and $812 million prior periods’ adjustments.

“This upward impact on the debt stock was partially offset by the transfer of Philippine debt papers from non-residents to residents ($843 million),” the BSP added.

Key external debt indicators “remained at prudent levels despite the rise in external debt” during the period, it also announced.

Expressed as a percentage of annual aggregate output, the external debt ratio improved to 19.7 percent from 19.9 percent a quarter ago but widened from 19.5 percent a year earlier.

“The same trend was observed using GDP (gross domestic product) as denominator with the Philippine economy growing by 6.2 percent in the third quarter of 2019,” the Bangko Sentral added.

The country’s debt service ratio (DSR) improved to 6.4 percent from 7 percent recorded a year ago.

“The DSR has consistently remained at single digit levels,” the central bank noted.

The DSR ratio is a measure of the country’s adequacy to meet its obligations, based on foreign exchange earnings, by relating principal and interest payments to merchandise exports and receipts from services and primary income.