Gov’t debt stock up to P4.7T

The government’s debt stock hit P4.706 trillion as of March, up by P51 billion, or 1.1 percent, from month-ago level as borrowings outpaced payments.

Finance Undersecretary Gil S. Beltran, however, said the ratio of debt stock to gross domestic product in the first quarter improved to 51.2 percent from 53.9 percent, boosting hopes for a credit rating upgrade for the Philippines.

Data on total outstanding debt from the Bureau of the Treasury showed that 57 percent, or P2.667 trillion, was borrowed from domestic lenders.

Local debt rose by P2.4 billion, or 0.1 percent, from P2.664 trillion posted in February.

Some 43 percent, or P2.039 trillion, of the total debt was booked in foreign currencies such as the US dollar, euro and yen.

Aside from loans extended by multilateral lenders and official aid from foreign governments, the Philippines also borrows abroad through the issuance of bonds denominated in these currencies.

Foreign borrowings rose by P47.9 billion, or 2.4 percent, from the P1.991 trillion owed to overseas lenders in February.

In March, government debt paper pegged in dollars amounted to an equivalent of P1.018 trillion while yen and euro loans stood at P78.6 billion and P30.7 billion, respectively.

The government’s total contingent debt—composed mainly of sovereign guarantees—went down by P20.8 billion to P525.1 billion.

This was mainly due to net repayment of foreign contingent obligations, the appreciation of the peso against the dollar and the repayment of National Power Corp.’s zero coupon bond.

Beltran said the first-quarter debt-to-GDP ratio fell 2.7 points from last year’s 53.9 percent due to economic growth and the government’s debt management measures.

Beltran said the government benefited from debt swaps it had been conducting since last year, which allowed the exchange of debts.

The bond swaps extended the average debt maturity of debts as of December to 8.8 years from 7.9 years in June 2010

“With the pace we are going, we are confident we can have a credit rating upgrade sooner than later,” Beltran said.