Senators are confident that the economy will recover and the government will have the capacity to pay its debts once the COVID-19 pandemic is over.
Senator Sherwin Gatchalian on Saturday, September 5, said that the increase in government borrowings is expected not only in the Philippines, but all over the world as countries continue to grapple with the novel coronavirus outbreak and its impacts.
"Over the last 30 years naging matibay ang ekonomiya natin at bumaba nang bumaba ang ating utang (our economy has remained strong and our outstanding debts have been declining)," Gatchalian, vice chairman of the Senate economic affairs committee, said in an interview over radio DWIZ.
"'Yong ganitong 'pag utang ay nangyayari sa buong mundo ang importante dito, dalawang bagay: Una, meron ka bang kapasidad na mangutang at pangalawa, kaya mong bayaran (This kind of borrowing has been happening all over the world but what's important here are two things: First, that you have the capacity to avail of loans, and, second, that you have the capacity to pay)," he said.
"Ang 'di maganda umutang ka tapos winaldas mo ang utang, pero sa ating pag-aanalisa nakikita naman natin may pinupuntahan 'yong pag-utang natin...May napupuntahan naman ng maayos para malaban ang COVID-19 (What's unacceptable is when you borrow and spend it for nonsense, but in my analysis, I see that these borrowings do not go to waste. I think they are properly spent to fight COVID-19)."
Gatchalian also observed that since the country's debt-to-gross domestic product (GDP) ratio remains low, the government will have the space for more borrowings.
"Next year, kung babalik na sa normal, nakikita ko babalik na ekonomiya at may kapasidad na magbayad (if everything will go back to normal, I see that our economy will recover and we will have the capacity to pay our debts)," he said.
"Itong pag-utang nating temporary lang 'yan at mababayaran natin next year (This borrowing is only temporary and we can pay them next year)," he maintained.
Senate President Vicente Sotto III also shared the same belief, saying government economic managers will not allow the Philippines to have a bad reputation in terms of credit-worthiness.
The Bureau of Treasury recently disclosed that the national government’s debt has increased to P9.164 trillion as of July this year.
Government economic and finance managers had also projected that the total outstanding debt for 2020 will reach more than P10 trillion, and would increase further to P11.982 trillion in 2021.