Philippine sovereign debt rises further to P14.15 trillion

The country’s sovereign debt stock swelled to a new record high as of end-June as the government boosts borrowing efforts to support its financing requirement, latest data from the Bureau of the Treasury (BTr) showed Tuesday.

The national government’s total outstanding debt stood at P14.15 trillion, up 0.4% from P14.10 trillion as of end-May. 

The month-on-month increase was attributed “primarily due to the net issuance of domestic securities,” according to the Treasury.

Of the total debt balance, 68.6% were sourced locally while the remaining 31.4% were from foreign sources.

Broken down, domestic debt totaled P9.70 trillion, up.2% from as of end-May.

“For the month, domestic debt growth amounted to P114.32 billion due to the net issuance of government bonds driven by the national government’s financing requirements,” the BTr said.

Foreign debt, meanwhile, stood at P4.45 trillion, down 1.4% month-on-month.

“The reduction in foreign debt was driven by the impact of currency adjustments affecting both US dollar- and third-currency equivalents leading to a decrease in the peso value of the debt, amounting to P69.98 billion and P8.28 billion, respectively,” the Treasury said.

“These more than offset the availment of foreign loans amounting to P15.25 billion,” it said.

As of the first quarter of 2023, the country’s debt-to-gross domestic product (GDP) ratio stood at 61%, down from 63.5% in the first quarter of 2022.

The debt-to-GDP ratio represents the amount of the government’s debt stock relative to the size of the economy.

The government is targeting to bring down the debt-to-GDP ratio to less than 60% by 2025, then further down to 51.1 percent in 2028, and reduce the budget deficit to 3.0% of GDP by 2028. — BM, GMA Integrated News