PH debt declines in September 2025 —Treasury

The Philippines’ sovereign debt continued its downward trajectory as of end-September 2025, consistent with the Bureau of the Treasury’s (BTr) announcement that the government would be paying off some of its maturing bonds.

Treasury data released Thursday showed the national government’s running debt stock stood at P17.455 trillion as of the end of last month, down 0.07% or P13.09 billion from P17.468 trillion as of end-August 2025.

“The continued decrease reflects the government’s sound fiscal discipline, strategic borrowing strategy, and proactive liability management, supported by steady market conditions and robust domestic investor confidence,” the BTr said.

Domestic borrowings continued to account for the lion’s share of the total outstanding debt at 68.6%, while the remaining 31.4% are foreign obligations.

The higher local debt versus foreign borrowings is in line with the government’s policy of reducing foreign exchange risk while deepening domestic capital market development, according to the Treasury.

Domestic debt, in particular, declined by P114.13 billion or 0.94% to P11.972 trillion as of end-September from P12.087 trillion as of end-August “as the government paid off more borrowings than it issued new ones.”

The BTr said total repayments exceeded new issuances by P117.29 billion, more than offsetting the P3.16 billion upward revaluation from the peso depreciation against the retail dollar bonds.

Meanwhile, foreign debt saw a slight increase by 1.88% or P101.4 billion to P5.482 trillion from P5.381 trillion month-on-month “largely due to the weaker peso.”

The Treasury said the peso’s weakness more than offset the P1.30 billion in net loan repayments and P2.1 billion in third-currency fluctuations.

“Overall, the September figures affirm the Marcos, Jr. administration’s strong fiscal discipline and proactive debt management, ensuring that government financing remains sustainable, strategic, and supportive of the country’s growth priorities,” the BTr said.

Finance Secretary Ralph Recto earlier said the country’s sovereign debt could balloon to as much as P20 trillion by the end of President Ferdinand "Bongbong" Marcos Jr.’s term in 2028.

Recto also said that the expected P20-trillion government debt stock is still consistent with the administration’s aim to bring down the debt-to-gross domestic product (GDP) ratio to less than 60% by 2028.

Debt-to-GDP ratio measures the amount of the national government’s outstanding debt proportionate to the value of the economy during a specific period.

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

Due to the aggressive borrowing spree to fund response, relief, and cash aid efforts amid the COVID-19 pandemic, the country’s debt-to-GDP grew to 60.5% in 2021, higher than the 54.6% level in 2020.

Prior to the COVID-19 pandemic, the Philippines’ debt-to-GDP ratio reached a record low of 39.6% in 2019. — BM, GMA Integrated News