The Philippines' foreign debt reached 54.4 billion U.S. dollars in the third quarter of 2007, pushed by the appreciation of other currencies against the greenback, the country's central bank BSP said on Friday.
This level represents a 1.4-billion (2.6 percent) increase from 53.0 billion dollars as of end-June 2007, largely due to upward revaluation adjustments of third currency-denominated debt arising from the weakening of the U.S. dollar, the central bank said in a statement posted on its website. Third currencies refer to currencies other than the Philippine peso and the U.S. dollar.
The peso's strength alone was not sufficient to trim the debt, as other currencies also appreciated against the U.S. dollar, the BSP said.
According to the BSP, the euro and yen appreciated against the U.S. dollar in the third quarter of the year, causing the country's debts denominated in those currencies to become more expensive.
The central bank however said major external debt ratios continued to improve during the third quarter of 2007 due to higher levels of aggregate output, foreign exchange receipts and international reserves in spite of the increase in external debt stock.
The external debt ratio, or outstanding external debt as a percentage of aggregate output or GNP, improved to 36.8 percent, from 37.8 percent in June and 44.4 percent a year ago, the central bank said.
As a percentage of gross domestic product or GDP, the external debt ratio also improved to 40.4 percent, from 41.3 percent in June and 48.3 percent a year ago.
The country's total principal and interest payments was equivalent to 9.8 percent of total foreign exchange income from the export of goods and receipts from services and income, an improvement from the 11.1 percent ratio posted over the same period a year ago, said the BSP.
"The country's debt service ratio has remained well below the 20 to 25 percent international benchmark. This indicates that the country has sufficient foreign exchange earnings to service loans maturing during the current period," BSP Governor Amado M. Tetangco Jr. told reporters.
Source: Xinhua
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