Due to higher public spending, the country’s external debt increased US$3,319 million, which represents 1.8% more, for a total of US$187,3171 million in the first quarter of the year.
According to the figures of the Bank of the Republic, the obligations reached 55.3% of the Gross Domestic Product (GDP). In the quarterly increase, 84% corresponds to liabilities with original maturity greater than one year and 16% to credits with maturity equal to or less than one year. By type of instrument, the balance of external debt corresponds mainly to loans and bonds.
The Bank explains that the quarterly increase in the balance is explained by the increase in long-term (US$2,310 million, 1.5%) and short-term debt (US$1,009 million, 3.4%).
By sectors, the balance of public external debt represents 57% of the total and that of the private sector 43%. Of the total amount of external debt, 16% corresponds to loans between companies with a direct investment relationship.
As of March 2023, the balance of the external debt of the public sector is estimated at US$106,467 million (31.4% of GDP), higher by US$1,825 million (1.7%) compared to December 2022. The highest balance is This is explained by the increase in contracted obligations, both long-term (US$1,773 million) and short-term (US$51 million).
creditors
By type of creditor, the largest commitment by the public sector is with bondholders (US$1,885 million), with international organizations (US$283 million) and with bilateral banks (US$25 million), which was partially offset by the reduction in Balance with other creditors (US$368 million).
According to the Issuer, of the long-term debt balance, 71% corresponds to obligations of the national government, 20% to decentralized entities and the remaining 9% are obligations of other debtors.
By lenders, 51% of the balance is for bonds issued in international markets, 37% for loans with multilateral banks and 12% for credits with bilateral entities and financial institutions.
Of the total balance of the public sector, 94% is headed by non-banking entities and the rest are obligations of the banking sector.
During the first quarter of 2023, the debt service amounted to US$3,797 million, higher by US$2,012 million compared to the same period of 2022. Of the service amount, US$2,655 million (70%) corresponded to amortizations and US$1,142 million ( 30%) interest.
So far from 2023 to March, the average interest rate on new public sector external debt contracts was estimated at 8%, 3.6 percentage points higher than the rate contracted during 2022.
Private sector
At the end of the third month of the year, the private sector was left with obligations of US$80,903 million (23.9% of GDP). 80.2% corresponded to obligations of the non-banking sector and the remaining 19.5% to debts acquired by institutions of the banking sector.
In relation to the debt balance of the non-banking sector, loans with foreign entities represented 81%, financial leasing credits 9.14%, supplier credit obligations 6.52%, 3 The remaining 34% corresponds to bonds and insurance liabilities.
Regarding the banking sector, as of March 2023, loan obligations represented 58.61% of the external debt, 36.18% corresponded to bonds acquired by foreign investors and the remaining 5.21% to deposits of non-residents.
Likewise, the non-banking private sector increased its external obligations by US$1,855 million (3.4%) compared to what was registered in December 2022. This is due to net income from loans (both long and short term). For its part, the balance of the private banking sector decreased by US$361 million (2.5%) compared to that observed in December 2022, mainly due to the maturity and payment of bonds, partially offset by net disbursements of loans
The cost of new external debt contracts in the first quarter of 2023 is estimated at 9% (excluding loans with terms of less than one month that present high turnover), higher by 0.4 percentage points (pp) than the quarterly rate immediately prior and by 5 pp to that registered in the same period of 2022.
For long-term loans acquired in the first quarter of 2023, the average term (weighted by amount) was close to 6 years. The term of the short-term debt (excluding terms of less than one month) was close to 8 months.