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Philippines: Debt payments surge 172% to P83.8 B in June
MANILA, Philippines — The debt payments of the national government surged by 172 percent to P83.81 billion in June from P30.76 billion in the same month last year after the settlement of more foreign obligations.
Latest data from the Bureau of the Treasury (BTr) showed 65 percent of the total debt service or P54.71 billion in June went to principal payments, while the balance of 35 percent or P29.09 billion was used for interest payments.
Monthly amortization on foreign debt amounted to P54.71 billion in June or almost eight times the P6.69 billion spent in the same month last year to pay for foreign and domestic debt.
Likewise, interest payments increased by 21 percent to P29.09 billion from P24.06 billion due to higher interest payments for retail treasury bonds (RTBs) in the domestic front.
The government allots a portion of its budget for the settlement of obligations on a monthly basis, depending on their maturity.
Debt payments form part of the government’s expenditures.
For the first half, the national government settled P385.25 billion worth of domestic and foreign debt or 7.4 percent lower than the P415.9 billion it paid in the first half of 2018.
Interest payments from January to June this year went up by 8.8 percent to P180.07 billion from P165.51 billion in the same period last year.
However, monthly amortization for domestic and foreign obligations fell by 18 percent to P205.18 billion in the first semester from P250.39 billion in the same period last year.
For 2019, the national government is programmed to spend P887.91 billion for debt service, based on the 2019 Budget of Expenditures and Sources of Financing (BSEF) document of the Department of Budget and Management (DBM).
The amount is 14.5 percent higher than the actual debt payments of P775.59-billion made last year.
The amount of debt settled last year by the national government was almost 14 percent higher than the P680.47 billion in 2017 and 5.7 percent higher than the programmed payments of P733.74 billion.
The government borrows from the onshore and offshore debt markets to plug the budget deficit as it continues to spend more than the revenues it collects.
Source: https://www.philstar.com/business/2019/08/26/1946420/debt-payments-surge-172-p838-b-june#hQJVugYV5tcGyAHI.99