MANILA, Philippines, February 9 ------ The country’s outstanding obligation rose by 9.8 percent to P16.05 trillion in 2024 from P14.62 trillion in 2023 mainly due to higher government borrowings to finance the budget deficit and the impact of a stronger dollar. However, the latest debt figure was slightly below the record high of P16.09 trillion as of November 2024, based on data released by the Bureau of the Treasury (BTr).
The Marcos administration has added a total of P3.25 trillion to the country’s debt stock since taking office in July 2022. “The year-on-year increase in the debt stock is primarily attributed to the P1.31 trillion net issuance of debt instruments in line with the government’s deficit program, as well as the P208.73 billion valuation effect of US dollar strengthening,” the BTr said. Meanwhile, the Treasury said that advantageous third currency movements significantly trimmed the debt total by P80.74 billion.
Domestic securities continue to dominate the debt portfolio, accounting for 68.1 percent of the total last year, while external borrowings make up the remaining 31.9 percent. The country’s domestic debt went up by 9.1 percent to P10.93 trillion in 2024 from P10.02 trillion a year ago. It was also 0.1 percent higher from P10.92 trillion a month prior. External obligations, on the other hand, went up by 11.4 percent to P5.12 trillion year-on-year, but inched down by 0.9 percent from the P5.17 trillion as of November 2024.
Total debt guaranteed obligations decreased by 0.8 percent to P346.66 billion from a year ago amid net repayment of both domestic and external guarantees amounting to P5.25 billion and P66.63 billion, respectively. Following the 5.6 percent gross domestic product (GDP) growth in 2024, the share of national debt to the country’s output stood at 60.7 percent, still above the internationally accepted threshold. This was higher than the 60.2 percent debt-to-GDP ratio in 2023, but was an improvement from 61.3 percent in the previous quarter. It was also slightly above the 60.6 percent target set under the medium-term fiscal framework. “Nevertheless, the minimal deviation from the programmed debt underscores the national government’s effective cash and debt management strategies, including its proactive management of the level and timing of its external debt issuances amidst volatile exchange rate environment,” the BTr said.
The current debt-to-GDP ratio is slightly above the internationally accepted threshold of 60 percent. Reducing the ratio means that economic growth should outpace the level of borrowings of the Philippines.
Source: philstar.com
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