Philippines ended 2023 with P14.62-T debt — Treasury

The Philippines closed the year 2023 with a new record-high sovereign debt balance of P14.62 trillion, data released by the Bureau of the Treasury on Wednesday showed.

The national government’s outstanding debt amounted to P14.616 trillion as of end-December 2023, up 8.92% or P1.20 trillion from the end-December 2022 level of P13.18 trillion.

Month-on-month, the government’s running debt stock grew by 0.74% from P14.508 trillion as of end-November 2023.

The latest outstanding government debt brought the Marcos administration’s gross borrowings since it assumed office in June 2022 to P1.825 trillion.

Despite the rising sovereign debt, Finance Secretary Ralph Recto said this is not much of a concern since the debt value relative to the size of the economy is within comfortable levels.

In particular, the country’s debt-to-gross domestic product (GDP) ratio stood at 60.2% in 2023, an improvement from the 60.9% level as of the end of 2022.

The full-year 2023 debt-to-GDP ratio is significantly below the government’s target of 61.2% for the year under its Medium-Term Fiscal Framework.

A lower debt-to-GDP ratio indicates that the country can pay off its debt without having adverse impacts on the economy.

The narrower debt-to-GDP ratio last year came after the economy, as measured by GDP, grew by 5.6% in 2023 albeit below the government’s target range of 6% to 7%.

Meanwhile, of the total sovereign debt stock, 68.5% were sourced locally while 31.5% were from foreign borrowings.

Domestic debt stood at P10.2 trillion, up 8.97% year-on-year but contracted by 0.06% compared to the end-November 2023 level “primarily attributed to the net redemption of government securities.”

The government’s external debt totaled P4.6 trillion last year, up 9.21% year-on-year and 2.54% month-on-month “due to the net availment of foreign debt amounting to P88.2 billion (including $1 billion maiden issuance of Islamic bonds and disbursement of program loans from ADV amounting to $300 million).”

“Furthermore, the impact of third-currency adjustments against the US dollar added P28.45 billion which was slightly offset by the P2.67 billion effect of peso appreciation against the US dollar,” the BTr said. — RSJ, GMA Integrated News