PH debt balloons to new record high of P15.18T as of end-February 2024

The Philippines' sovereign debt continued to accumulate with the total outstanding balance reaching a new record high as of end-February this year, as the government issued more securities to prop up state coffers.

Data released by the Bureau of the Treasury (BTr) showed that the national government's debt stock reached P15.18 trillion, up 2.63% from P14.8 trillion as of end-January.

The Treasury attributed the month-on-month rise in the country's debt pile to domestic debt issuances, "though partially tempered by the effect of the stronger peso on foreign debt valuation."

Broken down, of the total P15.18 trillion debt stock, 69.68% are domestic debt while 30.32% are foreign debt.

Domestic debt amounted to P10.58 trillion, up 4.08% month-on-month "due to the net issuance of government securities."

The BTr said in February, total gross issuances totaled P708.74 billion, which included the P584.86-billion five-year Retail Treasury Bonds issuance.

The bureau added that principal payments amounted to P293.57 billion during the month, resulting in a net issuance of P415.17 billion. 

The peso's appreciation trimmed P660 million from the domestic debt through downward revaluation of foreign currency denominated domestic debt, according to the BTr, noting that the peso appreciated against the US dollar to P56.174:$1 as of end-February from P56.403:$1 as of end-January.

In an emailed commentary, Rizal Commercial Banking Corp. chief economist Michael Ricafort said the increase in the total outstanding debt was "widely expected" after the P584.86-billion Retail Treasury Bonds issuance.

Meanwhile, the country's external debt stood at P4.6 trillion, down 0.56% month-on-month.

"The decrease was attributed to favorable foreign exchange movements by both local- and third-currencies against the US dollar amounting to P18.79 billion and P9.96 billion, respectively," the BTr said.

"These more than offset the P2.75 billion net availment of foreign loans," it added.

Ricafort said the "outstanding debt could also still post new record highs amid the need to borrow by the government to continue financing budget deficits."

Data from the Department of Budget and Management (DBM) show that the borrowing program for 2024 was pegged at P2.46 trillion, higher than the P2.207 trillion in the past year.

Still under control

National Economic Development Authority (NEDA) Secretary Arsenio Balisacan said Thursday the Philippine debt is still under control despite ballooning to P15.18 trillion as of February of this year. 

''Oh, yes obviously. Yeah, it is. We are actually very… in a very good position. The rule of thumb for emerging economies is 70% of GDP... that is threshold ‘no. We are moving from 60% which way below 60 to even lower ‘no of 55 – almost about 56% by the time we end the term of the current President,'' Balisacan said at a Palace press briefing when asked on the matter. 

''So, we are not only way below the threshold but we are also… we also want to decrease that further,'' he added.—with Anna Felicia Bajo/KBK/AOL, GMA Integrated News