31.9 C
Manila
Thursday, March 28, 2024

NG debt inches closer to P12 trillion as of end-October

- Advertisement -

THE national government’s outstanding debt is inching closer to the P12-trillion mark as it further swelled to P11.97 trillion as of end-October this year, marking a new record high.

According to the latest data from the Bureau of the Treasury, the current debt stock level is 19.38 percent higher than P10.028 trillion a year ago.

While National Treasurer Rosalia V. De Leon earlier said they expect upcoming repayments to bring down the debt stock, the latest figure is still beyond the government’s expected level of P11.73 trillion by the end of this year.

Since the previous month’s level of P11.92 trillion, the country’s debt stock has slightly increased by 0.5 percent primarily due to the net issuance of domestic securities.

From P9.795 trillion as of end-2020, the debt level has already ballooned by 22.2 percent as of end-October this year.

The bulk of the debt stock or 70.7 percent was still sourced from domestic borrowings while the remaining P29.3 percent, from foreign borrowings.

Domestic debt as of end-October reached P8.47 trillion, surging by 19.65 percent year-on-year from P7.077 trillion. It has also picked up by 0.96 percent from the end-September level of P8.39 trillion.

Meanwhile, foreign debt hit P3.5 trillion, jumping by 18.74 percent from P2.95 trillion as of October 2020.

However, this was slightly smaller than the P3.529 trillion posted in the previous month due to the impact of local and foreign currency exchange rate adjustments.

Meanwhile, total outstanding guaranteed debt dropped by 4.77 percent to P426.46 billion from P447.85 billion a year ago.

It also contracted by 1.48 percent from P432.86 billion as of end-September this year due to the net redemption of domestic and external guarantees.

Rizal Commercial Banking Corp. Chief Economist Michael Ricafort said the outstanding debt slowed both on a month-on-month and year-on-year basis on the back of further reopening of the economy, which led to an increase in tax revenue collections and reduction in government expenditures.

However, Ricafort said the P360 billion raised by issuing 5.5-year Retail Treasury Bonds will increase the country’s outstanding debt stock by December.

Budget documents show the government expects outstanding debt to hit P13.42 trillion in 2022.

The country’s debt-to-GDP ratio this year is projected to rise to 59.1 percent and peak next year at 60.8 percent—slightly above the internationally accepted threshold—before gradually tapering off to 60.7 percent and 59.7 percent in 2023 and 2024.

As of the end of the third quarter this year, the country’s debt-to-GDP ratio is already at 63.1 percent.

The Department of Finance also sees the national government returning to its prepandemic debt and budget deficit levels as early as 2024 or by 2025, if the recommended fiscal measures are passed early by the next administration, and if the economy quickly recovers.

Read full article on BusinessMirror

- Advertisement -

Leave a Reply

- Advertisement -

Related Articles

- Advertisement -
- Advertisement -

Latest Articles

- Advertisement -