By LEE C. CHIPONGIAN The country’s external debt service burden dropped to $7.25 billion as of end-November 2019 or 3.2 percent lower than same time in 2018 of $7.49 billion. MB file photo. Based on Bangko Sentral ng Pilipinas (BSP) data, principal payments fell by 2.1 percent year-on-year to $4.36 billion from $4.86 billion. Interest payments, however, rose by 9.5 percent to $2.88 billion as of end-November from $2.63 billion. The Philippines as of end-September 2019 has an outstanding external debt of $82.7 billion, more than 8.2 percent compared to same time in 2018 of $76.4 billion. External debt service burden represents principal and interest payments but does not include prepayments on future loan maturities. The principal and interest payments are on fixed medium to long-term credits, loans and new money facilities. Interest payments also include fixed and revolving short-term liabilities of both banks and non-banks. Public sector external debt was at $42.5 billion as of end-September from $42.3 billion as of end-June last year, according to the BSP. In its external debt report, the BSP said about $35.6 billion of public sector loans were government borrowings while the remaining $7 billion are government-owned and -controlled corporations and government financial institutions loans. The private or corporate sector borrowed $40.2 billion during the period, more than $39 billion at end-June 2019. In the first nine months, private bank bond issuances totaled $401 million and these are ASEAN Green Bonds. BSP Governor Benjamin E. Diokno said earlier that the external debt to GDP ratio which was 23.7 percent means that the Philippines continue to have “sustained (and a) strong position” to pay for its foreign loans in the medium to long-term. The GDP ratio is only slightly higher than same time last year of 23.5 percent. External debt to gross national income, on the other hand, improved to 19.7 percent from 19.9 percent in 2018. The debt service ratio as of end-September was better at 6.4 percent compared to seven percent same time last year. The debt service ratio has consistently remained at single digit levels, the BSP reported. The country’s debt service ratio as it relates to debt service burden is a measure of adequacy of the country’s foreign exchange earnings to meet maturing obligations. “The sustained favorable external debt profile, demonstrated by the continued easing of the country’s external debt to GDP ratio, supports the external sector position,” Diokno said in a forum last week. “The country’s external debt metrics continue to ease significantly with external debt-to-GDP ratio.”