PH debt breaches ₱12 trillion for first time at start of 2022

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Metro Manila (CNN Philippines, March 4) — The Philippines began 2022 with a new record high in total outstanding loans, which breached the ₱12 trillion mark for the first time as the government borrowed more amid the COVID-19 pandemic.

Bureau of the Treasury (BTr) figures released Friday show the country’s total debt stock rose to ₱12.03 trillion as of end-January, a 16.5% year-on-year growth.

The latest figure zoomed past the previous ₱11.97 trillion all-time high recorded in end-October 2021. 

The Treasury said overall borrowings grew by ₱301.12 billion from end-December as the government sought more funding from local and foreign lenders during the health crisis.

Domestic loans, which accounted for 69.6% of the total debt stock, amounted to ₱8.37 trillion in end-January.

“This is primarily due to net availment of domestic financing amounting to ₱197.04 billion including the ₱300 billion provisional advances availed by the NG from the BSP for budgetary support,” the Treasury said.

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External debt amounted to ₱3.66 trillion during the month, said the bureau. This accounted for 30.4% of the total debt stock.

“For January, the increment in external debt was attributed to the impact of Peso depreciation against the USD (US dollar) amounting to ₱11.23 billion and the net availment of external obligations amounting to ₱94.88 billion,” read the bureau’s release.

Valuation adjustments in other foreign currencies totaling ₱2.37 billion, meanwhile, offset these according to the agency.

Guaranteed obligations fell by 7.4% in January to ₱422.52 billion amid the settlement of domestic and external guarantees at ₱2.12 billion and ₱220 million, respectively.

“This more than offset the effect of Peso depreciation against the USD amounting to ₱0.72 billion and net appreciation of third currency denominated guarantees against the US dollar amounting to ₱0.22 billion,” said the Treasury.

The Philippines ended 2021 with ₱11.7 trillion in debt, which is 60.5% of the country’s total economic output. It is the highest debt-to-gross domestic product (GDP) ratio since 2005 under the administration of Gloria Macapagal-Arroyo.