MANILA (UPDATE 2) - The Philippines has recorded a total of P12.68 trillion in outstanding debt as of the end of March 2022, the Bureau of Treasury said Thursday.
The total is higher than the P12.09 trillion recorded in February.
Out of the total, 30.1 percent was sourced externally while 69.9 percent were from domestic borrowings, the BTr said in a statement.
Domestic debt reached P8.87 trillion, higher by 5.4 percent compared to February.
External debt, meanwhile, was at P3.81 trillion for the month, or 3.6 percent higher compared to the previous month, the agency said.
Since assuming power in the latter half of 2016, President Rodrigo Duterte has more than doubled the country’s debt from just P5.95 trillion at the end of June 2016.
Malacanang meanwhile said the borrowings “shall be put into good use and utilized effectively and efficiently.”
“Recent borrowings would be for our COVID-19 response and recovery and resiliency efforts. We need to sustain our country’s long-term socioeconomic growth and development,” said Presidential Communications Secretary and Acting Presidential Spokesperson.
The country has been borrowing heavily in the last few years due to its COVID-19 response and recovery efforts, and the administration's infrastructure program launched prior to the pandemic.
Recent borrowings brought debt-to-GDP ratio to 60.5 percent in 2021 from 39.6 percent before the COVID-19 pandemic. But economic managers have argued that the current debt level remains manageable.
Michael Ricafort, chief economist at RCBC, said that in the coming months, the government’s outstanding debt could still reach new record highs in view of additional government borrowings, especially to frontload the borrowing requirements before the elections.
The weak peso-dollar exchange rate, among the weakest in 2.5 years or since August 2019, also partly increased the peso equivalent of the government’s foreign debts, he said.
Ricafort added that interest payments for new borrowings could also rise as central banks around the world raise interest rates, with local/US/global long-term interest rates at new pre-pandemic highs.
But he also said that measures to further re-open the economy towards greater normalcy would help narrow the country’s budget deficit and help also temper the growth in the government’s debt stock.