Debt payments rise thrice in March

Bureau of the Treasury

THE national government hiked its debt payments by more than threefold in March compared to a year earlier as interest and amortization payments both increased, according to Bureau of Treasury data.

At P533.52 billion, debt servicing in March was 275.3 percent higher than the P142.17 billion recorded a year earlier. It was also substantially higher than February 2024’s P293.62 billion.

Amortizations still accounted for the bulk at P462.58 billion, markedly higher than the year-earlier P81.27 billion and almost double the P245.79 billion in February.

The remaining P70.94 billion involved interest payments, higher than the P60.9 billion posted in March last year and also up from February’s P47.83 billion.

Domestic amortization accounted for almost all amortization expenses at P455.91 billion. This was higher than the P73.36 billion and P243.63 billion a year and a month ago, respectively.

Foreign amortization, meanwhile, plunged to P6.67 billion in March from P7.91 billion last year. It was, however, higher than February’s P2.16 billion.

As for interest payments, P55.71 billion — up from P46.75 billion a year earlier — went to local creditors. In the previous month, these were higher at P34.35 billion.

Foreign interest payments, meanwhile, rose to P15.24 billion in March from P14.14 billion 12 months earlier. It was also higher than the P13.48 billion recorded in February of this year.

Year to date, government debt payments were 74.3 percent higher at P986.04 billion from January-March 2023’s P565.72 billion.

The bulk was again used for amortization, amounting to P793.04 billion, while the remaining P193 billion went to interest payments.

The national government’s outstanding debt fell to P14.93 trillion in March, snapping a five-month run of record highs.

It fell from February’s P15.18 trillion but was still higher than the year-earlier P13.9 trillion, Treasury data showed.

The drop was attributed to the net redemption of domestic government securities.

Of the total debt stock, domestic borrowings comprised the bulk, or 68.86 percent, at P10.28 trillion. It was 2.83 percent lower compared to February’s P10.58 trillion.

External debt, meanwhile, totaled P4.65 trillion, 1.0 percent up from the prior month’s P4.6 billion. This comprised the 31.14 percent of total outstanding debt as of end-March.

The Finance Department on Monday said that planned government borrowings would be raised to P2.57 trillion this year from P2.46 trillion given a higher deficit projection, which the Development Budget Coordination Committee raised last month to P1.48 trillion from P1.39 trillion.

The borrowing mix remains at 75:25 in favor of domestic sources, from which the government expects to get P1.93 trillion with the rest to come from foreign sources.