PHL external debt position declined 13.7% as of end-September

The Philippines' international investment position posted a lower net liability of $33.9 billion as of end-September, down 13.7% from $39.3 billion in end-June, according to the Bangko Sentral ng Pilipinas (BSP).

The decline in external debt position resulted from the 2.1% increase in the country's total external financial assets or residents' investments abroad to $192.8 billion, combined with a 0.7% decrease in total external financial liabilities or non-residents' investments in the Philippines amounting to $226.7 billion.

"The increase in the country's external financial assets during the quarter by $3.9 billion was underpinned by the expansion in all asset components led by residents' portfolio (8.8 %) and direct (1.3%) investments abroad," the central bank said.

"The modest decline in total external financial liabilities by $1.5 billion in end-September 2019 was driven mainly by lower outstanding foreign portfolio investments (2.3%), particularly in equity securities issued by residents (5.9%)," it said.

By sector, the BSP noted that it is the only net creditor with a net external asset position of $84.5 billion in end-September 2019.

Meanwhile, the other major sectors remained net users of foreign resources, it said.

On the assets side, the BSP said it continued to hold the highest stock of the country's external financial assets at 44.5% or $85.8 billion in end-September 2019.

"This was followed by Other Sectors at 38.2% ($73.7 billion) and the banks at 17.2% ($33.2 billion)," it said.

By type of instrument, almost half or 44.4% of residents' external financial assets were reserve assets held by the BSP at $85.6 billion.

Direct investments in the form of debt instruments or intercompany lending and equity capital placements in foreign affiliates accounted for 16.8% and 12.3%, respectively.

"The rest were residents' holdings of debt securities issued by non-residents (11.9%), currency and deposits abroad (6.7%), and other assets (7.9%)," it said.

On the liabilities side, the Other Sectors accounted for about two-thirds or 64.4% of the country's total external financial liabilities, which stood at $146 billion as of end-September 2019.

The General Government's external liabilities amounted to $40.7 billion, while that of the banks' reached $38.7 billion, comprising 18% and 17.1% of the country's total external liabilities, respectively.

Meanwhile, the BSP's share of the country's total external financial liabilities was a modest 0.6%, which stood at $1.3 billion.

By type of instrument, the country's total external outstanding financial liabilities to the rest of the world comprised of non-residents' placements of equity capital in resident affiliates at 23.1%, non-residents' holdings of equity securities issued by local corporations at 22.4%, and residents' outstanding foreign loans at 20.9%.

"The rest were in the form of non-residents' investments in debt instruments issued by resident affiliates (16.6%), holdings of debt securities issued by residents (13.4%), and other liabilities (3.6%)," the BSP said. — BM, GMA News