THE national government’s outstanding debt rose to record-high anew at P7.167 trillion during the first 10 months of the year, swelling on the back of higher local and foreign borrowings.
Data released by the Bureau of the Treasury (BTr) showed the government’s outstanding debt rose by 10.24 percent from P6.501 trillion as of end-October 2017.
Total obligations increased 0.10 percent from an earlier record-high of P7.160 trillion as of end-September 2018.
Domestic debt amounted to P4.620 trillion, up 9.59 percent from P4.216 trillion year-on-year. Foreign debt stood at P2.546 trillion, up 11.45 percent from P2.285 trillion a year earlier.
Month-on-month, local borrowings grew by 0.71 percent while foreign debt declined by 0.98 percent.
The increase in domestic debt was due to the net issuance of government securities amounting to P32.74 billion. This was slightly offset by the peso’s appreciation that decreased the value of onshore dollar bonds by P290 million.
“The decline in external debt was primarily due to the P27.34 billion impact of the stronger peso and net repayment on foreign obligations amounting to P330 million,” the Treasury said.
The local currency strengthened from P54.102:$1 as of end-September to P53.527 as of end-October.
Foreign debt accounted for 35.54 percent of total outstanding liabilities as of end-October, while domestic borrowings contributed 64.46 percent.
Budget secretary Benjamin Diokno earlier said that “the rule of thumb is that a country with a debt-to-GDP [gross domestic product] ratio below 60 percent is fiscally sound…The Philippines is comfortably below that…”
As of end 2017, the country’s debt-to-GDP ratio was 42 percent and the Department of Budget and Management expected the ratio to go down to 39 percent in 2022.
As percent of GDP, the Philippines has an external debt ratio of 20.4 percent as of June 2018, lower than those of Malaysia at 74 percent, Vietnam at 44.8 percent, Indonesia at 37.5 percent, and Thailand (31.7 percent), but higher than those of India (17.4 percent) and China (14.5 percent). (With GMA News/PN)
