The country’s public sector debt rose in the first quarter from a year ago as various government entities borrowed funds to partly support operations.
The debt, however, had become more manageable, as its proportion to the size of the economy shrunk.
This was according to the Department of Finance, which reported Thursday that the consolidated public sector debt (CPSD)—the combined outstanding liabilities of the national government, state-owned firms, and local government units—amounted to P7.69 trillion as of the end of March.
The amount marked a 4.6-percent increase from the P7.35 trillion in the same period last year.
It was equivalent to 71.3 percent of the country’s gross domestic product, down from 74.3 percent last year.
On a quarter-on-quarter basis, the latest CPSD was up by 2 percent. It stood at P7.5 trillion as of the end of December last year, equivalent to 71.4 percent of GDP.
The decline in the proportion of the public sector debt to GDP came about as the growth of the economy outpaced that of the liabilities of the government entities.
Finance Secretary Cesar Purisima said the improving manageability of the debt substantiated views that the Philippines had, indeed, become more credit-worthy over the years.
The Philippines this year got investment grades from all three major international credit rating agencies. These agencies noted improvements in the country’s macroeconomic fundamentals, including improving manageability of debt.
Purisima earlier said that even with the upgrades, the Philippines remained one of the most underrated countries in the world, if interest rates on sovereign bonds were taken into account.
He said interest rates on Philippine bonds fetched interest rates comparable with securities issued by countries with credit ratings that were a notch or two higher.