Gov’t debt stock dropped 1.3% to P4.746T in July

The government’s debt stock eased to P4.746 trillion in July—down by P64 billion, or 1.3 percent, from that of June due to a stronger peso and net redemption of domestic securities.

With the latest population estimated at 95.6 million, each citizen would have a share of P49,645 of the country’s outstanding debt.

In contrast, data from the National Statistical Coordination Board showed that per capita gross national income (formerly called gross national product) amounted to P33,560 in current prices as of the end of June.

The data include payments for goods produced and services rendered abroad.

According to the Bureau of the Treasury, 58 percent, or P2.736 trillion, of the total outstanding debt had been secured from domestic lenders.

Local debt decreased by P23.2 billion, or 0.8 percent, from P2.759 trillion posted in June.

The decrease was attributed to the government’s decision to redeem more debt notes compared to new ones that have been issued.

On the other hand, 42 percent, or P2.01 trillion, of total outstanding debt was booked in foreign currencies, such as the US dollar, the euro and yen.

Aside from securing loans extended by multilateral lenders and official aid from foreign governments, the Philippines also borrows abroad by issuing bonds denominated in foreign currencies.

Foreign borrowings decreased by P40.7 billion, or 2 percent, from that of June.

The decrease in foreign debt was due mainly to the appreciation of the peso against the US dollar, which shaved off P64 billion from the debt stock.

However, the government posted P1 billion in new borrowings as opposed to debt payments made in July.

The appreciation of the yen and the euro against the dollar dampened the decrease of total obligations by adding P22 billion.

In July, government debt paper pegged in dollars amounted to an equivalent of P987.8 billion, while yen and euro loans stood at P81.3 billion and P30.2 billion, respectively.

Further, the government’s total contingent debt—composed mainly of sovereign guarantees—went down by P8.3 billion to P586.6 billion.

The decrease was attributed to the appreciation of the peso against the dollar, as well as the redemption of the National Development Co.’s so-called agri-agra bonds.