PH debt trimmed in September, hitting P9.37 trillion

The country’s outstanding debt stock declined to P9.37 trillion by end-September as the national government repaid a P300-billion short-term borrowing from the Bangko Sentral ng Pilipinas (BSP).

The latest Bureau of the Treasury data released on Thursday showed the national government’s outstanding obligations at the end of the first nine months was 2.6-percent lower than end-August’s record high P9.62 trillion, although 18.5-percent higher than the P7.91 trillion recorded a year ago.

Locally sourced debt, which accounted for the bulk, or 68.7 percent of the end-September total, declined by 4.1 percent month-on-month even as it jumped by 22.5 percent year-on-year to P6.44 trillion.

While the national government already settled the debt sourced through the BSP and the Treasury’s repurchase agreement at the onset of the COVID-19 lockdown, it advanced a fresh P540 billion from the central bank in October to beef up its war chest against the health and socioeconomic repercussions of the pandemic.

From January to September, the government raised a gross amount of P2.64 trillion from the sale of treasury bills and bonds, of which maturities amounted to P1.33 trillion during the nine-month period.

Meanwhile, foreign debt inched up by 1 percent month-on-month and climbed by a faster 10.6-percent year-on-year to P2.93 trillion.

The Treasury attributed the increase in external liabilities to the P33.22-billion net availment of foreign loans, which offset some gains in foreign currency-denominated borrowings after the peso strengthened against the US dollar to P48.422 last month from 48.483:$1 in August.

During the nine-month period, the Philippines borrowed P550.27 billion from multilateral lenders, bilateral development partners and offshore commercial markets, while external debt repayments reached P123.19 billion.

To finance the protracted fight versus the pandemic, the government had programmed to borrow a record P3 trillion—a gross of P2.22 trillion locally plus P785.6 billion from foreign sources—in 2020.

As such, the outstanding debt will hit a new high of P10.16 trillion by end-2020, hiking the debt-to-gross domestic product ratio to 53.9 percent from a low of 39.6 percent in 2019.