Brief History of the Philippine Foreign Debt

It is necessary for us to go back to the 1983 debt explosion in order to fully understand the seriousness of the problem. Filipinos incurred a debt of $2 billion in 1972 which ballooned into $28 billion in 1983 under the regime of Marcos, which was almost 90% of the GNP. Since then, the government became unable to pay the amount, growing bigger up to now.

The debt crisis slowly recovered in 1993 under the administration of ex- Pres. Fidel V. Ramos. The economy flourished, making the Philippines the Tiger Cub of Asia, and no longer the sick man.

Presently, Filipinos are burdened with a $52 billion debt owed to multilateral institutions like the World Bank, Asian Development Bank and donor countries such as Japan and the United States, as released by BSP. The $52 billion loan was used to fund government infrastructures, projects and to refinance debt.

The following table of the foreign debt of the Philippines from 1990 to 2000 (in million US dollars) shows that the foreign debt remained stable for three consecutive years but soon swelled since then within a span of only eight years.

TABLE 1: PHILIPPINE FOREIGN EXCHANGE LIABILITIES from 1990-2000 (in million US dollars)

Year	total
1990	29,955
1991	31,392
1992	32,089
1993	35,535
1994	38,723
1995	39,367
1996	41,875
1997	45,433
1998	47,817
1999	52,210
June 2000	52,164

Foreign exchange, or the total sum of foreign currency in the financial system of the Philippines including loans, exports, remittances of overseas workers however went down in the year 2000 by only a small gap.