Gov’t debt payments down 20%

Government’s debt payments continued on a downtrend, declining 20 percent in the 10 months to October as the Aquino administration continued to accelerated public spending to sustain rapid, inclusive growth.

Latest data from the Bureau of Treasury showed that the government serviced P498.045 billion in debts from January to October, down from P622.05 billion a year ago.

Of the total, the government spent P219.47 billion for principal payments, 38.2 percent lower than the P355.36 billion settled a year earlier. Payments for domestic obligations amounted to P112.59 billion or 63 percent percent less than the P306 billion paid a year ago.

Payments for foreign obligations, however, more than doubled to P106.88 billion from only P49.36 billion.

Total interest payments amounted to P278.57 billion during the period, up 4.45 percent from the previous level.

The government paid P185.55 billion for interest on domestic loans, an increase of 10.8 percent from P167.43 billion. Interest payments for foreign obligations, on other hand, decreased six percent to P93.02 billion.

In October alone, the government spent P27.905 billion to pay down debt, down 33 percent from the year earlier’s P41.66 billion.

Debt servicing continues to decline as the government aims to lengthen the maturity of its financial obligations.

For next year, the government is setting aside P791.5 billion for public debt servicing. The amount accounts for 34 percent of the proposed 2014 national budget of P2.268 trillion.

Of the total, P352.7 billion will go to interest payments – P248.4 billion for domestic debt and P104.3 billion for foreign borrowings. The amount is 5.6 percent higher than the P333.9 billion programmed for this year.