Gov’t debt hits record P14.79 trillion at end-January

THE NATIONAL Government’s (NG) outstanding debt hit a record P14.79 trillion as of end-January as it issued more securities locally and amid a weaker peso, the Bureau of the Treasury (BTr) said on Friday.

Preliminary data from the BTr showed that the NG’s outstanding debt went up by 1.19% or P173.91 billion from the end-2023 level of P14.62 trillion “due to the net issuance of domestic securities and the effect of peso depreciation.”

Year on year, the debt stock rose by 7.97% from P13.7 trillion seen as of January 2023.

Of the end-January total, the bulk or 68.71% came from domestic sources, while 31.29% are external debt, the BTr said.

Domestic debt stood at P10.16 trillion as of January, 1.44% higher than P10.02 trillion a month prior amid the net issuance of government securities. This was also 8.28% more than the P9.38 trillion recorded at end-January 2023.“Gross issuance of domestic debt for the month reached P211.11 billion, while principal payments totaled P69.67 billion, resulting in a net issuance of P141.44 billion,” the BTr said.

“Meanwhile, the valuation effect of local currency depreciation against the US dollar on foreign currency-denominated domestic debt added P2.81 billion to the January total,” it added.

Data from the BTr showed the peso closed at P56.403 per dollar at end-January, weaker than its P55.418 finish at end-December 2023.

Meanwhile, external debt inched up by 0.65% month on month to P4.63 trillion as of January from P4.6 trillion. It also climbed by 7.29% from P4.31 trillion a year prior.

“The increase was attributed to the P81.73 billion upward revaluation caused by local currency depreciation against the US dollar. However, this was partially offset by favorable movements in third currencies (P28.52 billion), reducing the net increase by P52.07 billion,” the Treasury said.

“Additionally, external loan availment contributed P61.86 billion for the month… Meanwhile, total repayment of external loans amounted to P85.41 billion ($1.51 billion) resulting in a total net repayment of P23.55 billion for January 2024,” it added.

BTr data showed external debt was comprised of P2.19 trillion in loans and P2.43 trillion in government securities.

The NG’s guaranteed obligations went down by 0.22% to P348.66 billion as of end-January from the end-December level of P349.44 billion. Year on year, guaranteed obligations declined by 11.47% from P393.84 billion.

The net repayment of domestic and external guarantees stood at P1.12 billion and P240 million, respectively.

“In addition, third currency appreciation against the US dollar further trimmed P2.40 billion. These more than offset the P2.98 billion revaluation effect of peso depreciation on dollar-denominated guarantees,” the BTr said.

The government’s borrowing program for this year is set at P2.4 trillion, with P1.85 trillion to be raised from domestic sources and P606.85 billion from foreign creditors.

It borrows from local and foreign sources to help fund its budget deficit, which is capped at 5.1% of gross domestic product this year. — B.M.D. Cruz