Foreign debt down slightly in March at $73.2 billion

The private sector’s net repayments of its foreign loans pushed the country’s outstanding external debt lower by 0.8 percent year-on-year to $73.2 billion as of end-March, Bangko Sentral ng Pilipinas (BSP) Governor Nestor A. Espenilla Jr. said in a statement.

The debt stock was down by $609 million because of some $3.4-billion net repayments during the period, mostly from the private sector’s short-term non-trade accounts.

Quarter-on-quarter, Espenilla said external debt was slightly up by 0.1 percent from end-2017’s level of $73.1 billion, partly because of a weak US dollar. About 61.5 percent of the external debt currency mix are in US dollar while 13.5 percent are in Japanese yen.

The BSP reported that yearon-year, the downward impact on the debt stock was partly offset by: previous periods’ adjustments of $1.5 billion due to late reporting; upward foreign exchange revaluation adjustments amounting to $713 million; and transfer of Philippine debt papers from residents to non-residents totalling $618 million.

As for the first quarter data, the small increase in debt stock was partly due to a positive foreign exchange revaluation adjustments of $621 million which the BSP explained was “due largely from the weakened US dollar against the Japanese yen which pushed the debt stock higher by $655 million.” The peso depreciation vis-à-vis the greenback “decreased the debt level by $144 million.

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

BSP data show that the public sector external debt of $39.2 billion or 53.6 percent of total debt stock as of end-March, was higher than the $37.5 billion or 51.3 percent of total, from endDecember, 2017.

The BSP attributed the increase to net availments of $1.5 billion, mainly by the National Government amounting to $1.6 billion, as it issued two bond offerings during the quarter.

The government issued a $2-billion Global Bonds last February, of which $750 million is new money. It also offered RMB1.5 billion or $233 million Panda Bonds in March.