Determinants of External Debt in Thailand and The Philippines

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  • Evan Lau
  • Alvina Syn-Yee Lee


External debt has been the major global concern not only heavily indebted poor countries (HIPCs) but also developing nations in resultants of the 2008 Global Financial Crisis (GFC). It has become a well-discussed subject and generally a concern of global finance and world of economy greatly. This paper analyses the role of some macroeconomic variables in determining the external debt burden in Thailand and the Philippines from 1976 to 2013. The results indicate the existence of short-run linkages originated from inflation rate (CPI) and real interest rate (RIR) to external debt (ED) in the case of Thailand. As for the Philippines, although there is no evidence of short-run linkages origin from GDP, CPI, RIR and M2 to ED, but the burden of short-run adjustment appears to have fallen mostly on GDP and M2. Further, dynamic econometric analysis suggests that money and quasi money (M2) to total reserves ratio is the most exogenous variable beyond the 50-years horizon. The study concludes that a sound debt management could be implemented to control debt accumulation and to reduce dependence on debt relief in the form of foreign aid. Keywords: External Debt Burden; Thailand; the Philippines.JEL Classifications: F34; C22


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Author Biography

Evan Lau

Evan Lau is a well-trained Universiti Putra Malaysia graduate with vast experience and research excellence covering the areas of International Economics with numerous applications of econometrics techniques. Recently he ventured into socioeconomic discipline including Economics of Crime and Suicide. He joined Faculty of Economics and Business Universiti Malaysia Sarawak (UNIMAS) in 2005 soon after completing his Ph.D. He servicing as a senior lecturer since 2008 and promoted to Associate Professor from June 2014. He is the Managing Editor of International Journal of Business and Society (IJBS), an internationally refereed journal indexed in Emerging Sources of Citation Index (ESCI), SCOPUS bibliographic database, Malaysian Citation Centre (MCC), ProQuest publisher, Ulrich's Periodicals Directory, Cabell's Directories (Economics, Finance and Management) and EBSCO Host Publishing. He is the director of Centre for Business, Economics and Finance Forecasting (BEFfore), UNIMAS which among other serves as a platform and reference point for business, economic and finance forecasting. He was the Visiting Scholar in Faculty of Economics in University of Cambridge from October 2013 – April 2014. At present he is the Deputy Dean for Research and Postgraduate in Faculty of Economics and Business. As of today, his journal articles publications are at 76, in which 16 were in the Thomson ISI list. These journals were Journal of Business Economics and Management, Economics Letters, Economic Modelling, Journal of Policy Modeling, The Manchester School, Japan and the World Economy, Energy Sources, Part B:  Economics, Planning, and Policy, Applied Economics, South African Journal of Economics, Journal of Asia Pacific Economy, Applied Economics Letters, Singapore Economic Review. In addition, he has 84 research papers published as chapters in books, conference proceedings, working papers, newsletters and newspaper articles. Â Â His excellence in research has brought him towards several award winnings. Beginning in his doctoral studies days, he was awarded with first prize from the Faculty of Economics and Management, Universiti Putra Malaysia (UPM) in 2001. Subsequently, this led him on to more winning awards. These include: 3 times recipients of Young Researcher Award in UNIMAS; 2 times recipients Excellent Service Award, numerous research medals from several Research Expo (UNIMAS and UPM), best papers from several conferences and Highest Impact Journal Paper Award (Social Science Cluster) for UNIMAS from 2005 – 2013. Research apart, he does carry out his role as a dedicated lecturer. He provides lectures, consultations and supervisions to students. Courses that he has taught include History of Economic Thoughts, Principle of Economics, Applied Econometrics, Research Methodology for Economics and Business, Econometric, Public Finance, Malaysian Economy, Current Economics Issue, Modeling in Economics, Principles of Microeconomics, Economic Research Method at undergraduate level; Firms, Institution and Competition and Economics at the graduate level. To date, he has 56 post-graduate students under his supervision. Those who had completed include 4 Ph.D (Economics), 11 Master of Science (Economics) and 31 students from Corporate Master in Business Administration (CMBA). Those being in progress are the remaining 10 of which 7 Ph.D students (5 as chairperson, 2 advisory committee); 2 masters of sciences in Economics. Besides, he had successfully supervised 93 undergraduate students. He also managed to examine 24 postgraduate thesis and 126 undergraduate research projects. As an active researcher, he has been awarded 22 research grants from UNIMAS (internal grants) and Ministry of Higher Education (Fundamental Research Grant Scheme, FRGS, Exploratory Research Grant Scheme, ERGS, Research Acculturation Grant Scheme, RAGS and Research Acculturation Collaborative Effort, RACE). In recent, Evan Lau has presented 92 research papers around the world. As part of recognition and internationalization, he was listed as Top 10% economists in Malaysia since 2008 and Top 12% in Asia since 2012 by the Research Papers in Economics (RePEc) database. He was also cited as Top 10 Most Productive Malaysian Based Authors in Arts, Humanities and Social Sciences for the year from 2001 to 2010, published by the Malaysian Citation Centre (MCC), Ministry of Higher Education (MOHE) in 2012. Apart from that, his biography was selected to be listed in the 29th Edition of Who's Who in the world for 2012. He also indeed contributed to society in terms of economic research studies. Thus, an invitation was extended to him for interviews in several special programs on Budget (2006, 2011), post budget 2013 and live radio interview in 2012 on the Malaysian broadcasting station. His profile is also made available at SCOPUS, RePEc, ResearchGate, Google Scholar and Academia where he was among the highly cited authors in UNIMAS.




How to Cite

Lau, E., & Lee, A. S.-Y. (2017). Determinants of External Debt in Thailand and The Philippines. International Journal of Economics and Financial Issues, 6(4), 1973–1980. Retrieved from