BILLIONS of dollars worth of loans were added to the country’s total external debt on the back of higher debts incurred by the private sector, according to the Bangko Sentral ng Pilipinas (BSP).
The country’s total external debt (EDT) stood at $128.7 billion as of end-March 2024, $3.3 billion or 2.6 percent higher than the $125.4billion level as of end-December 2023.
Private sector debt rose to $49.8 billion at the end of the January to March period in 2024. This was $2.2 billion more, or a 4.7-percent increase, from the end-2023 level of $47.6 billion.
“[The increase in private sector debt] was due mainly to bond issuances by local private banks amounting to $1.8 billion,” BSP said in a statement. “Its share to total debt [increased] to 38.7 percent from 37.9 percent last quarter.”
Nonetheless, the bulk of the country’s EDT was due to government loans which amounted to $78.9 billion or 61.3 percent of the total country’s external loans.
The BSP said public sector loans increased $1.1 billion or 1.4 percent in the first quarter of 2024 from the $77.8 billion posted in the last quarter of 2023.
The data showed the increase in public sector external loans were driven by the net acquisition by non-residents of public sector debt securities aggregating to $1.6 billion, and the $331 million loans for national government projects/programs.
“About $72.3 billion—or 91.6 percent—of public sector obligations are attributed to the NG, while the remaining $6.6 billion—or 8.4 percent±pertained to borrowings by government-owned and controlled corporations, government financial institutions and the BSP,” the data showed.
In terms of loan sources, the BSP listed the major creditor countries: Japan with $15.2 billion worth of debts, followed by the United Kingdom at $4.6 billion; and the Netherlands at $3.9 billion.
BSP said loans from official sources accounted for the largest share, or $50.7 billion or 39.4 percent of the total outstanding debt.
The data showed these loans included debts from multilaterals worth $34.8 billion and bilateral creditors at $15.9 billion.
Apart from loans from official sources, the BSP said external borrowings included bonds/notes amounting to $42.2 billion or 32.8 percent of the total.
The list also included obligations to foreign banks and other financial institutions worth $28.5 billion or 22.1 percent of the total, while the rest, worth $7.3 billion or 5.6 percent, were owed to other creditors such as suppliers/exporters.
In terms of currency mix, the country’s external debt stock remained largely denominated in US dollars, worth $97.8 billion or 76 percent of total; followed by the Japanese yen, $11.1 billion or 8.6 percent of total.
The rest, amounting to $19.8 billion or 15.4 percent, were in 17 other currencies, including the Philippine peso at $9.3 billion or 7.2 percent; the Euro, $5.9 billion or 4.6 percent; and Special Drawing Rights, $3.8 billion or 2.9 percent.
As of end-March 2024, the maturity profile of the country’s external debt remained predominantly medium to long term in nature or those with original maturities longer than one year; with its share to total at 86.7 percent or $111.6 billion.
Relative to the previous quarter, the weighted average maturity for all MLT accounts increased to 16.8 years from 16.7 years, with public sector borrowings having longer average tenor of 20.1 years versus 7.6 years for the private sector.
Meanwhile, short-term liabilities or those with original maturities of up to one year stood at $17.1 billion, or 13.3 percent of the total external debt.
The BSP said this comprised mainly bank liabilities worth $13.1 billion; trade credits, $2.7 billion; and other liabilities, $1.3 billion.
Of the MLT accounts, $59.9 billion or 53.7 percent have fixed interest rates and $48.9 billion or 43.8 percent carry variable rates. The remaining $2.8 billion or 2.5 percent are non-interest bearing.
