Debt hits record-high P14.62T as of end-2023

THE Philippines’s outstanding debt as of end-2023 rose to a record high of P14.62 trillion, higher by P1.2 trillion than the end-2022 level, as the new government borrowed more to fund the continued budget deficits and lower amount of government bonds maturities.

e Bureau of the Treasury (BTR) on Wednesday reported that the national government’s (NG) debt increased by P107.54 billion in December from the P14.50-billion outstanding debt level in November.

e increase in debt, the Treasury said, is “due to net availments and exchange rate adjustments.”

e Treasury said the end-2023 level falls below the 61.2 percent target and is “consistent with efforts to improve debt sustainability” as outlined in the mediumterm fiscal framework (MTFF).

Domestic debt stood at 68.5 percent while external borrowings accounted for 31.5 percent of the total debt stock, the Treasury noted.

e NG’S debt for the end-december level is at P10.02 trillion, indicating an increase of P809.54 billion or 8.79 percent from the end-2022 level.

e country’s latest debt figure was 8.92 percent higher than the P13.418 trillion recorded in December 2022.

Data from the Treasury also noted the state’s end-december debt stood at P10.017 trillion, 8.79 percent over the P9.208 trillion recorded in the same month of last year.

Meanwhile, the end-december debt amount was -0.06 percent lower than the P10.024-trillion domestic debt recorded in November. “Gross issuance of domestic debt in December 2023 totaled P29.69 billion while principal payments amounted to P36.08 billion, resulting in a net repayment of P6.39 billion,” the Treasury said.

“e effect of local currency appreciation against the US dollar on debt stock valuation further trimmed P0.09 billion from the December total,” the Treasury added.

External debt

THE state’s external debt rose by P387.86 billion, higher by 9.21 percent than the December 2022 level. Compared to November 2023, the level is also P114.02 billion or 2.54 percent higher.

e national government’s external debt was 9.21 percent higher

than the P4.210 trillion recorded external debt in December 2022.

e Treasury attributed this to the state’s “net availment of foreign debt amounting to P88.24 billion, including US$1.0 billion maiden issuance of Islamic bonds and disbursement of program loans from ADB amounting to US$300 million,” the Treasury said.

“e impact of third-currency adjustments against the USD added P28.45 billion which was slightly offset by the P2.67 billion effect of peso appreciation against the USD,” the Treasury explained.

Rizal Commercial Banking Corp.’s Chief Economist Michael L. Ricafort said the national government’s debt could still post new record highs given upcoming borrowings such as the peso-denominated Retail Treasury Bonds (RTBS) in the first quarter of the year.

“Continued budget deficits, though narrower from year-ago levels, could still lead to additional borrowings/debt by the national government,” Ricafort said.

e RCBC executive added that the national government’s outstanding debt may also be attributed to “higher interest rates that raised borrowing costs of the government, weaker peso exchange rate versus the US in recent years that increased the peso equivalent of the government’s foreign debts, continued increase in infrastructure spending.”