If she wins the presidency this May 2022, Vice President Leni Robredo plans on addressing the Philippines' ballooning loans and will “honor the commitments” by improving the country’s debt-to-GDP (gross domestic product) ratio.
Robredo said it is important to honor these loan commitments as was done by the late President Corazon Aquino during post-Martial Law because this will show the international community that the Philippines is a good borrower.
“Number one, I will honor the commitments because the integrity of our country depends on it, but I'll make sure that what we borrowed—especially in the last few years when our debt really piled on — I'll make sure that the money we loaned went to the things that they were supposed to, and that the return to us is a thousand-fold,” she said in a mix of Filipino and English during the “2022 Presidential One-on-One Interviews” with Boy Abunda.
Robredo, an economist and lawyer, added that there’s nothing wrong with borrowing.
“It's not bad to loan if you really need it and the returns are greater than what we borrowed. But loaning is bad if it goes to corruption,” she stressed, adding that there’s no point in borrowing if the return isn’t big.
“Masama ang utang kung ito napunta sa mga bagay na hindi naman ‘yung karamihan sa mga Pilipino ang nakikinabang (Loans are bad if they go to things that do not benefit majority of the Filipinos),” Robredo told the TV host.
The Philippines has an outstanding debt of around P11.6 trillion as of August 2021. This new record-high is expected to increase this year because of more loans taken out by the government to fund its pandemic response.
READ: Gov’t debt jumps to P11.6-trillion in August
She warned that the country doesn’t have an “elbow room” anymore because its debt-to-GDP ratio is already at 60 percent, up from 44 percent before the pandemic.
Economic experts suggest that the debt-to-GDP ratio of countries should be below 60 percent.
If she wins, Robredo promised to “fix the government, fix the institutions” to regain the people’s trust.
“Because that's the only way we can strengthen our GDP and growth rate,” she said.