Philippines’ total debt goes Past P12 Trillion

According to the Bureau of Treasury (BTr), the Philippines ’ total outstanding debt has breached the P12 trillion mark for the first time last January. The Bureau reports that pandemic-related expenses continued to rise amid falling government income.

Additionally, the Bureau stated that the year-on-year debt growth from Jan 2021-2022 was about 16.5%, as 30.4% was sourced externally and 69.6% came from domestic borrowings.

“This is primarily due to net availment of domestic financing amounting to P197.04 billion including the P300 billion provisional advances availed by the NG (National Government) from the BSP (Bangko Sentral ng Pilipinas) for budgetary support,” the Treasury said when asked about the domestic debt.

“For January, the increment in external debt was attributed to the impact of peso depreciation against the US dollar amounting to P11.23 billion and the net availment of external obligations amounting to P94.88 billion,” the BTr added.

The Philippines then ended 2021 with a debt-to-GDP ratio of 60.5%, slightly higher than the accepted threshold.

The country’s domestic debt totaled P8.37 trillion while external debt reached P3.66 trillion. However, economists and market analysts are more concerned about where the money is going.

Finance Secretary, Carlos Dominguez III, reportedly took a conservative stance during the pandemic and borrowed less than what critics called for. Furthermore, Dominguez stated that the Department of Finance (DOF) will prepare its fiscal consolidation program. It is assumed that the program will involve tax hikes to repay the country’s increasing debt. Dominguez also expressed his wishes to discuss the debt situation with all the presidential candidates.

Source: Rappler