NG debt rises anew to 16.44 trillion in September

Government debt jumped anew in September this year owing to higher borrowing from the domestic market and weaker local currency against the US dollar, data from the Bureau of the Treasury showed.

As of September, the national government’s outstanding debt in both domestic and offshore markets stood at R6.444 trillion, higher by 5.9 percent compared with R6.086 trillion in the same period last year.

Of the total, domestic obligations reached R4.188 trillion, representing 65 percent of the government’s debt, while foreign creditors control the remaining 35 percent, equivalent to R2.255 trillion.

At end-September, government debt in the local market increased by 7.3 percent year-on-year from R3.094 trillion, while foreign obligations rose at a much slower pace of 3.4 percent from R2.182 trillion in the previous year.

According to the Treasury report, the increase in total debt was mainly due to domestic securities issuance which more than offset the effect of currency revaluation on foreign currency debt.

Over the last nine-months, the national government debt increased by 5.81 percent equivalent to R353.8 billion.

The peso also weakened against the greenback this year from R48.28 to P50.83.

Month-on-month, the national government’s outstanding debt slightly rose by 0.2 percent from the previous month’s level of R6.431 trillion.

Domestic debt rose by 0.9 percent in September compared with R4.151 trillion in the previous month due to net issuance of seven- and 10-year treasury bonds amounting to R36.96 billion, but was tempered by the R0.16 billion impact of the stronger peso.

Domestic debt increased by R254.38 billion or 6.5 percent from the endDecember 2016 level.

External debt, meanwhile, declined by 1.1 percent than the previous month’s R4.151 trillion.

The treasury said the reduction in external debt was a combined effect of the stronger peso and appreciation of third-currencies against the US dollar amounting to R15.19 billion and R8.83 billion,

respectively, adding to net repayments of R0.41 billion.

To date, the national government external debt increased by R99.40 billion or 4.6 percent for the year.

Meanwhile, total national government guaranteed obligations went down by R8.48 billion or 1.7 percent month-on-month to R489.06 billion at end-September 2017.

The decline in guarantees was due to the combined effect of peso appreciation, the effect of third currency revaluation and net repayments on both domestic and external guarantees.

From the end-December 2016 level, total guarantees have gone down by R24.61 billion or 4.8 percent.