Government debt stock breached the P10 trillion mark in October amid unprecedented borrowings for the coronavirus response, data from the Bureau of the Treasury showed.
Total outstanding debt of the national government stood at P10.028 trillion as of October this year, up by 26.8 percent compared with P7.906 trillion in the same period last year.
The actual end-October government debt is just 1.3 percent short to hit the Duterte administration’s P10.16 trillion target for 2020.
According to the Treasury, the increase was owing to additional borrowings from both domestic and foreign lenders.
At end-October, the national government’s debt are 71.6 percent held by Philippine-based creditors, while the remaining 28.4 percent are owned to foreign financial institutions.
Domestic debt rose by 27 percent year-on-year to P7.077 trillion in October from P5.304 trillion.
Since January, the Duterte administration has added P1.949 trillion to the total domestic debt stock and P658.81 billion in October alone.
External debt, on the other hand, reached P2.95 trillion at end-October, an increase of 13 percent compared with P2.601 trillion in the same month last year.
Based on the treasury data, about P346.63 billion in fresh debt were added to total foreign obligations in last 10-months after securing additional P19.83 billion financing from the offshore markets in October.
Amid aggressive borrowings to fund the government’s wider budget deficit due to COVID-19 response and dwindling revenue collections, the Treasury clarified that the Duterte administration has yet to breach its P3 trillion borrowing ceiling for the year.
The national government’s total gross financing in January to October amounted to P2.835 trillion, still shy by 5.5 percent against program, the treasury said.
On Thursday, the inter-agency Development Budget Coordination Committee (DBCC) adjusted its budget deficit ceiling for the year following the better than expected collections of the Bureau of Internal Revenue (BIR) and Bureau of Customs
From an earlier estimate of 9.6 percent budget deficit to gross domestic product (GDP) ratio, the DBCC is now forecasting the government’s financing gap to hit by only 7.6 percent in 2020.
According to the DBCC, revenue haul of the BIR and Customs would likely surpass the original target by 13 percent to P2.85 billion from P2.532 trillion.
“Our deficit program is designed to balance the requirement of supporting economic recovery while keeping our debt-to-GDP ratio beneath a sustainable threshold,” DBCC said.
“We will not abandon the prudent fiscal management set by President Duterte when he assumed office in 2016 and put us in a good fiscal position ahead of the pandemic,” it added.