Philippine gov't debt breaches P12T mark as of end-January

Published March 04, 2022 11:12 AM By TED CORDERO,GMA News

The Philippine government’s running debt balance ballooned to a new record-high and breach P12-trillion mark as of end-January this year amid continued borrowing efforts to boost state coffers for COVID-19 recovery measures, data released Friday by the Bureau of the Treasury (BTr) shows.

Treasury data showed that the end-January national government outstanding debt stood at P12.03 trillion, 2.6% higher than the P11.73 trillion debt recorded as of end-December 2021.

The month-on-month increase in the government’s total debt stock was due to “the net availment of both domestic and external debt.”

Year-on-year, the total outstanding debt grew 16.5% from the P10.33 trillion posted as of end-January 2021.

The government’s debt is composed mostly of domestic borrowings at 69.6%, while the balance of 30.4% was sourced externally.

Finance Secretary Carlos Dominguez earlier defended the uptick country’s programmed debt, which is expected to hit the internationally recommended threshold of 60% proportion of gross domestic product this year.

The Philippines ended 2021 with a debt-to-GDP ratio of 60.5%, slightly higher within the accepted sustainable threshold.

Dominguez earlier said the Department of Finance (DOF) is preparing its fiscal consolidation proposal

which would likely involve tax hikes to repay the country’s increasing debt. 

The Finance chief has also expressed willingness to sit down with all the presidential candidates to discuss how to manage the trillions of pesos in government debt the next presidency will inherit from the Duterte administration. 

Domestic debt totaled P8.37 trillion, 2.4% higher than the end-December 2021 level of P8.17 trillion.

“This is primarily due to net availment of domestic financing amounting to P197.04 billion including the P300 billion provisional advances availed by the NG (national government) from the BSP (Bangko Sentral ng Pilipinas) for budgetary support,” the Treasury said.

The central bank announced in January that it is set to loan out another P300 billion to the national government, as budgetary support as the country continues to address the impact of the COVID-19 pandemic. 

External debt, meanwhile, stood at P3.66 trillion, up 2.9% from P3.6 trillion in end-December 2021.

“For January, the increment in external debt was attributed to the impact of peso depreciation against the US dollar amounting to P11.23 billion and the net availment of external obligations amounting to P94.88 billion,” the BTr said, noting that the local currency depreciated against the greenback from P50.974:$1 as end-December 2021 to P51.135:$1 as end-January 2022.

“These were tempered by valuation adjustments in other foreign currencies amounting to P2.37 billion,” the Treasury added. —KBK, GMA News

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