The outstanding debt of the national government (NG) reached P10 trillion as of end-October, as it borrowed more to fund the country’s pandemic response.
The Bureau of the Treasury (BTr) said on Friday that outstanding debt jumped 7.03% to P10.028 trillion as of end-October from the P9.369 trillion as of end-September. The October debt stock is also 2.84% higher than the P7.906 trillion logged a year ago.
The NG debt portfolio as of October was already 29.7% more than the P7.731-triliion level at the end of 2019.
Around two-thirds (71.6%) of the debt were from domestic sources while 28.4% came externally.
The local debt stock rose 9.9% month-on-month to P7.077 trillion due to the issuance of domestic government securities alongside additional provisional advances from the Bangko Sentral ng Pilipinas (BSP), the BTr said.
In October, issued government securities reached P6.536 billion, up by 2.88% from September’s P6.437 billion.
In the same month, the BSP approved P540 billion in fresh provisional advances to the national government, which should be settled by Dec. 29 at zero interest.
Meanwhile, foreign borrowings rose 0.7% month-on-month to P2.95 trillion.
“The increment in external debt was attributed to the P18.98 billion net availment of external loans and P2.42 billion net appreciation of third-currency against the dollar, offsetting the effect of local-currency appreciation amounting to P1.57 billion,” the BTr said.
In 2019, debt-to-gross domestic product (GDP) ratio stood at a low of 39.6%. The government expects this to balloon to 53.9% this year as the debt stock piles up during the crisis.
“We will not abandon the prudent fiscal management set by President [Rodrigo R.] Duterte when he assumed office in 2016 and put us in a good fiscal position ahead of the pandemic,” the Development Budget Coordination Committee said on Thursday.
Amid lower revenues during the pandemic, the government is planning to borrow more to plug the budget deficit that may reach 7.6% of GDP this 2020. — Luz Wendy T. Noble
