The national government has borrowed less in the first three months of the year as sources of state revenue start to normalize on the back of easing quarantine restrictions, data from the Bureau of the Treasury showed.
The Treasury reported over the weekend that the Duterte administration’s total borrowings amounted to P1.082 trillion from January to March, down 21 percent from P1.381 trillion in the same period last year.
While government’s foreign borrowings nearly doubled in the first quarter, its domestic financing was slashed below the trillion level during the period.
According to the Treasury, borrowed money in the local market amounted P849.12 billion at end March, 35 percent lower compared with P1.302 trillion a year earlier.
The bureau said the government browsed P457.8 billion from small Filipino savers through the sale of retail treasury bonds, as well as tapped the Bangko Sentral ng Pilipinas for P300 billion in short-term financing.
The government also sold P230.86 billion worth of long-term IOUs.
In the overseas markets, the national government raised P224.02 billion through borrowings, about 192 percent more than the P79.45 billion in the first three-months of 2021.
Foreign borrowings during the quarter were composed of global bond sale amounting to P117.32 billion, as well as program and project loans from the country’s development partners reaching P86.07 billion and 26.6 billion, respectively.
In March alone, borrowings hit P589.88 billion, a 4.4 percent decrease from P617.3 billion in the same month last year.
Of that amount, P458.56 billion were financed by domestic creditors while the remaining P131.32 billion were overseas borrowings.
The National Economic and Development Authority earlier estimated that the economy is gaining P9.4 billion per week from the country’s shift to alert level 1. The additional economic activity brings in extra tax revenues for the government in return.
But despite the easing quarantine rules, the national government’s debt stock continued to soar, hitting P12.679 trillion as of March 2022. This is an increase of 4.8 percent or P586.29 billion from P12.093 trillion in the previous month.
According to the Treasury, the significant jump in total debt portfolio was primarily driven by higher borrowings from both local and foreign creditors.
Finance Secretary Carlos G. Dominguez III had said that President Duterte’s successor should avoid accumulating additional debt.
He noted that the debt problem incurred during the more than two-year Covid-19 crisis will be the biggest challenge for the next administration.
Dominguez pronouncement comes after the Department of Finance revealed that it would take up to 40 years to payoff all the additional foreign debt, amounting to at least P1.3 trillion, incurred by the Duterte administration since 2020.