External debt service down at end-April

billion, data from the Bangko Sentral ng Pilipinas (BSP) show.

Total principal debt service burden amounted to $1.671 billion, down 13.10 percent from April last year’s $1.923 billion. Interest payments were also lower by 1.82 percent from $881 million to $865 million.

The debt service ratio continued to show the adequacy of public and private sector’s foreign exchange earnings.

The debt service ratio which relates to principal and interest payments to exports of goods and receipts from services and primary income is a measure of adequacy of the country’s foreign exchange earnings to meet maturing obligations.

As the end of the first quarter, the BSP said

The country’s external debt service burden continued to drop as of end-April to $2.536 billion or 9.56 percent lower compared to same period in 2017 of $2.804 this ratio improved to 7.6 percent from the 9.1 percent same time in 2017. The debt service ratio has consistently remained at single digit level.

The Philippines’ external debt as of end-March stood at $73.2 billion overall, lower by 0.8 percent year-on-year or $609 million, and this is mainly due to a $3.4billion net repayments from the private sector’s short term non-trade accounts.

The public sector external debt totaled $39.2 billion while private sector debt was down to $34 billion during the period. The private sector’s net repayments of its foreign loans pushed the country’s outstanding external debt lower in the first quarter, said the BSP.