Philippines’ outstanding foreign debt jumps to record $148.87 billion as of the end of June Sentral Ng Pilipinas (BSP) in Bangkok said in a weakening of the dollar.
The country’s foreign debt rose 14.4% from $1303.18 billion in the same period last year, according to the central bank.
“The increase in foreign debt is driven primarily by lending, including the National Government’s bond issuance of $5.83 billion, and local banks borrowed from $3.44 billion in external financing,” the BSP said in a statement.
In the quarter, foreign debt rose 1.5% from $1.5% registered at the end of the first quarter.
“The increase in foreign debt in the second quarter of 2025 (Q2) is mainly due to the valuation impact of US dollar depreciation,” BSP said.
Foreign debt explains all loans for non-resident residents.
BSP said the foreign debt level remains “sustainable”, equivalent to 31.2% of GDP. That’s better than 31.5% in the previous quarter, but higher than 28.9% a year ago.
The weaker Greenguard will be equivalent to USD 1.49 billion in the same dollar as other currencies, the central bank said.
Peso made strong results between the P55 and P56 levels during the April-June period, AVAs of the end of the day to June, p56.581.
“Net acquisition of Philippine debt securities of $660.9 million also contributed to the increase (foreign debt), while net repayments of $315.67 million were partially alleviating the country’s increase in foreign debt,” BSP said.
The majority of public sector obligations in the country total $88.371 The billion dollars came from the National Government, the rest came from the BSP ($3.919 billion) and Government Bank (USD 1.81 billion).
Japan remains the top creditor of the Philippines with loans of $1.599 billion, followed by the UK with loans of $6.358 billion and Singapore with loans of $48.37 billion.
The lending portfolio consists mainly of US dollar-denominated debt, followed by Philippine peso debt and Japanese yen debt.
As of the second quarter, the country’s short-term foreign debt based on the concept of remaining maturity (Strm) was US$28.63 billion. STRM debt is amortized by loans with an original maturity of one year or less and for medium and long-term accounts due within the next 12 months.
“The country’s gross international reserves (GIR) cover $1006 billion, providing 3.7 times the cover for short-term obligations,” BSP said.
“The country’s GIR to Strm debt ratio is consistent with its emerging economic peers.”
Meanwhile, BSP said lower principal and interest payments for resident borrowers have lowered the debt repayment ratio to 8.7% from 9.8% a year ago. This ratio measures a country’s ability to fulfill its obligations based on its foreign exchange income.
“This is due to lower principal and interest payments by resident borrowers as of the second quarter of 2025,” it said.
BSP data showed that at the end of June, foreign debt in the public sector rose 88.2% to $94.801 billion, up from $500.36 billion in the previous year.
On the other hand, private sector obligations fell 32.3% year-on-year, down from $79.83 billion a year ago to $54.072 billion. – Katherine K. Chen
