PH debt service burden grew by nearly 5% to $5.2B as of April
MANILA, Philippines — The government and private sector paid a combined $5.2 billion in external debt service from January to April, up nearly 5 percent from a year earlier.
Even so, debt service as a share of export receipts — a key gauge of a country’s ability to pay its foreign obligations — eased to 22.7 percent from 24 percent a year earlier. That meant the Philippines used more than 22 cents of every dollar earned from exports to service external debt, down from 24 cents previously.
READ: PH gov’t debt servicing rose anew in May
Principal repayments surged nearly 12 percent to $2.7 billion, likely reflecting a larger volume of maturing external obligations during the period, which drove up amortization costs.
Interest payments, meanwhile, declined 2.5 percent to $2.5 billion.
Under a presidential order, the BSP is the designated agency for compiling and publishing external debt statistics, a mandate aimed at bolstering transparency.
Readily available debt data help borrowers and lenders make better decisions while giving policymakers and analysts the tools to safeguard debt sustainability and broader macroeconomic stability.
READ: PH debt hits new peak at P18.55T
The latest debt-service figures covered a period of conflict involving the United States, Israel, and Iran that has rattled global financial markets.
The turmoil has triggered oil-price shocks that have complicated the inflation outlook for many economies, prompting some central banks — including the BSP — to tighten monetary policy.
Last month, the BSP raised its benchmark interest rate by a quarter percentage point to 4.75 percent. The move brought total rate increases since April to 50 basis points, underscoring the central bank’s effort to tame inflation as external risks mount.
At the same time, US Treasury yields have climbed amid expectations that the US Federal Reserve may raise interest rates this year in response to persistent war-driven inflation pressures.
Higher US yields have added pressure on the peso, which has weakened past the 61-per-dollar level, making foreign debt servicing more expensive. /atm
