Philippine foreign debt payments rise 5.2 per cent to US$8.25 billion
Principal repayments increased 12.9 per cent in January–July, while interest payments were virtually unchanged at US$4.67 billion.
The Philippines paid US$8.25 billion towards its foreign debt in January–July, a 5.2 per cent increase from US$7.84 billion a year earlier, according to Bangko Sentral ng Pilipinas data. Higher principal repayments drove the rise.
Repayments of principal reached US$3.58 billion, up 12.9 per cent from US$3.17 billion. Interest payments showed little change at US$4.67 billion.
Despite the increase, debt servicing absorbed a smaller share of export shipments: 20.3 per cent, compared with 21 per cent a year earlier. Payments represented 8.7 per cent of combined goods exports, service receipts and primary income, matching the previous year's proportion.
RCBC chief economist Michael Ricafort attributed part of the increase to larger budget deficits and borrowing accumulated since the pandemic, with some loans now maturing. He said elevated interest rates had also sustained high borrowing costs.
Ricafort said the government generally restrains foreign borrowing to limit potential foreign exchange losses. He added that external loans typically have medium- to long-term maturities to spread repayment dates, while domestic borrowing supplies a larger portion of government funding.
Separately, BSP figures put outstanding external debt at US$154.93 billion at end-June, against US$148.87 billion a year earlier. Its ratio to gross domestic product increased to 31.6 per cent from 31.2 per cent.
