Saturday, October 16, 2010

RP's external debt, 2000-2010

Below is the Philippines’ total external debt, in US$ billion.

2000, 51.21
2001, 51.90
2002, 53.64
2003, 57.40
2004, 54.85
2005, 54.19
2006, 53.37
2007, 54.94
2008, 53.86
2009, 53.27
June 2010, 56.99


External debt has generally flattened this decade, with this year's level similar to the 2003 level of $57 billion. Nonetheless, a debt is a debt that must be paid someday. The sooner than our external debt will be drasticallyy reduced, the better. Thus, instead of rising from 2009's level of $53.3 B to this year's $57 B, it should decline to $50 B in the next few years, down to $40 and lower through the years.

Debts were incurred in the past to improve current and future economic conditions of the country. Thus, current and future debts should be declining, not flattening or rising.

Big governments though, have the ugly habit of keeping the debts high so that they too, can take out huge loans on their own as current administration pay off the debts of past administrations. The vicious circle goes on.

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