Philippines' external debt declines US$2.2 billion in Q1 2020

Proposed Second Smart City in the Philippines After New Clark City in Pampanga
Proposed second Smart City in the Philippines next to the New Clark City in Pampanga. This plan is for the planned reclamation in Manila bay. - illustration: gineersnow.com

Philippines' external debt declines US$2.2 bil in Q1 2020 

The Philippines' outstanding external debt stood at US$81.4 billion as of end-March 2020, down by US$2.2bil or 2.6 per cent from the US$83.6 billion level as of end-December 2019, the central bank of the Philippines said on Friday (June 19).

"The decline in the debt level during the first quarter was due to net repayments of US$4 billion largely attributed to the settlement of short-term maturing obligations by the private sector," the Bangko Sentral ng Pilipinas (BSP) Governor Benjamin Diokno said in a statement.

"This was offset by the 1.1 billion U.S. dollars increase in non-residents' investments in Philippine debt papers issued offshore, demonstrating investors' confidence in the country's creditworthiness; prior periods' adjustments of US$580 million; and positive foreign exchange revaluation adjustments of US$101 million as the US dollar weakened against the Japanese yen," he added.

Year-on-year, Diokno said the country's debt stock rose by US$990 million.

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

Public sector external debt increased to US$45.1 billion from US$42.8 billion in the previous quarter, he added.

Meanwhile, Diokno said private-sector debt decreased from US$40.8 billion as of end-December 2019 to US$36.3 billion as of end-March 2020.

Diokno added that key external debt indicators "remained at prudent levels" and that the country's total outstanding debt-to-GDP ratio "remains one of the lowest as compared to other Asean member countries."

The Philippines' Gross International Reserves stood at US$88.9 billion as of end-March 2020 and represented 6.7 times cover for short-term debt under the original maturity concept. - Xinhua/Asian News Network
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