The Philippines’ external debt service burden (DSB) increased by 4.8 percent to $6.21 billion in the first five months of 2026 from $5.93 billion in the same period in 2025 on the back of scheduled repayments.

The latest Bangko Sentral ng Pilipinas (BSP) data showed that the increase in the country’s servicing of its foreign debt was fueled by a rise in principal payments, which offset a marginal decline in interest payments (IPs).

An increasing external DSB indicates that a larger portion of the country’s financial resources is being used to pay off foreign obligations.

Amortization, or principal payments, rose by 13.6 percent to $3.01 billion during the five-month period from $2.65 billion last year. Meanwhile, IPs edged down by 2.3 percent to $3.2 billion from $3.28 billion a year ago.

SM Investment Corp. (SMIC) group economist Robert Dan Roces said the rising debt service largely reflects “scheduled repayments, not financial stress.”

“More debt matured during the period, pushing principal payments higher, while IPs declined. With ample reserves and steady foreign currency inflows, the country remains well-positioned to meet its external obligations,” Roces said.

As of end-March, the Philippines’ total external debt stood at $147.35 billion, a slight increase from $146.74 billion a year ago. Government debt accounted for approximately $95.66 billion, or nearly two-thirds of total, while the private sector accounted for $51.7 billion.

Foreign borrowings were equivalent to 26.1 percent of the country’s annualized gross national income (GNI) as of end-March, down from 27.8 percent a year ago.

Meanwhile, the ratio fell to 30 percent of annualized gross domestic product (GDP) as of end-March, compared with 31.5 percent as of end-March 2025.

GNI measures the total income generated by a country’s residents, both domestically and abroad, while GDP accounts for local output.

As of end-May, the DSB-to-export shipments ratio eased to 21.6 percent from 22.4 percent in the same period of 2025, while the DSB-to-current account receipts ratio remained unchanged at 8.9 percent.

Furthermore, gross international reserves (GIR) stood at $103.99 billion by end-May, down from $105.18 billion a year ago. Despite the lower reserves, the annualized GIR-to-DSB ratio rose to 773.6 percent from 616.2 percent a year ago, reflecting a strengthened liquidity buffer relative to the DSB.

According to the BSP, the foreign DSB represents principal and IPs. This covers payments on fixed medium- and long-term (MLT) credits, including those from the Washington-based multilateral lender International Monetary Fund (IMF) and new money facilities.

It also includes IPs on fixed and revolving short-term liabilities of banks and nonbanks. However, it excludes prepayments on future maturities of foreign loans and principal payments on short-term obligations.