The next elected Philippine president will pay the loans secured by the Duterte administration for the country’s pandemic response, the government’s chief economic manager said on Tuesday, Feb. 22.

“Looking realistically our situation, we have to pay for COVID. I mean, we cannot just have COVID and not pay for it,” Finance Secretary Carlos G. Dominguez III said at a virtual forum by Financial Executives Institute of the Philippines (FINEX).

“You don’t how much we spent just for the vaccines,” Dominguez said.

As of Jan. 14, 2022, the government borrowed a total of $22.55 billion, or roughly P1.15 trillion, in budgetary support in relation to its COVID-19 response.

These loans came from several development partners as well as local and foreign commercial banks, data from the Department of Finance (DOF) showed.

Dominguez, however, declined to elaborate when asked if the next administration will need to increase taxes to payoff these debts incurred during the pandemic. He said the DOF is in the process of completing a fiscal consolidation plan for the country’s next leaders.

Dominguez is also hopeful that whoever succeeds President Duterte will find their fiscal consolidation plan “useful in continuing the dynamic recovery of the domestic economy over the next few years.”

“We commit to a seamless transition and stand ready to assist the next administration as it takes over the reins of leadership. The fiscal consolidation plan is just one of the many measures that have to be undertaken by the next administration,” he said.

Dominguez said that outgrowing debts is first on the list that should be addressed by the next presidency at the soonest possible time in order to lower its share in relation to the gross domestic product (GDP).

In 2021, the government’s debt-to-GDP ratio rose to 60.5 percent from a historic low of 39.6 percent in 2019.

The government had to resort to emergency borrowings, he said, to cover the massive cost of COVID-19 response and the corresponding drop in revenues resulting from the mobility restrictions and economic slowdown spawned by the global pandemic.

“The only way to make this sustainable is by growing the economy faster and investing in the future. The fiscal deficit should be lowered to cover only infrastructure investments and not operational expenses,” he said.

Dominguez said he was “quite sure” that the next Secretary of Finance and several other DOF officials of the next administration would come from the ranks of FINEX, given that it is the premier association of finance professionals.