The government’s outstanding debt ballooned to an all-time high of P13.70 trillion as of end-January this year from P13.42 trillion in December 2022 as the government borrowed more money to finance the budget deficit, the Bureau of the Treasury said Tuesday.
“From end-December 2022, NG’s total outstanding debt increased by P279.63 billion or 2.1 percent due to the net availment of domestic and external debt,” the Treasury said in a statement.
It also jumped by P1.67 trillion, or 13.9 percent, from P12.03 trillion registered in January 2022. The government incurred a budget deficit of P1.6 trillion in 2022, representing 7.3 percent of the gross domestic product.
Data showed that of the total debt stock, 31.5 percent came from other countries and 68.5 percent represented domestic borrowings.
Domestic debt rose 1.9 percent to P9.38 trillion in January from the end-December 2022 level following the net availment of domestic financing amounting to P179.16 billion, which offset the P2.61-billion effect of local currency appreciation against the US dollar on foreign denominated onshore securities.
Domestic debt also went up by more than P1 trillion, or 1.2 percent, from P8.37 trillion a year earlier.
Foreign debt amounted to P4.31 trillion in January, P103.08 billion or 2.4 percent higher from the previous month. It also jumped by P651 billion, or 17.8 percent, from P3.66 trillion a year ago.
“The increase in NG’s external obligation for January was brought on by the P186.56 billion net availment of foreign loans and P10.36 billion impact of third-currency adjustments against the US dollar. However, peso appreciation reduced the peso value of foreign currency denominated debt by P93.84 billion,” the Treasury said.
Michael Ricafort, chief economist of Rizal Commercial Banking Corp., said the higher government borrowings in January resumed after the seasonal lull during the holidays in December.
“For the coming months, new record high for the outstanding national government in peso terms is still possible, in view of the recent peso RTB issuance in February 2023 and the upcoming US dollar-denominated ROP bond issuance in 2Q 2023,” Ricafort said.
Total national government guaranteed obligations decreased by P5.21 billion or 1.3 percent month-on-month to P393.84 billion as of end-January 2023.
The Treasury said the lower level of guaranteed debt was due to the net repayment of both domestic and external guarantees amounting to P1.12 billion and P0.21 billion, respectively. The peso appreciation against the US dollar trimmed the amount by P4.31 billion, which more than offset the net appreciation of third-currency denominated guarantees against the greenback amounting P0.42 billion.