Government borrowings were slashed by P1 trillion in the first eight months of the year owing to lower financing both from local and foreign creditors, data from the Bureau of the Treasury revealed.

Based on the report by the Treasury bureau, the national government’s gross borrowings dropped 42 percent to P1.379 trillion in January to August this year from P2.387 trillion in the same period in 2021.

The a trillion peso decline in government financing was driven by the 46 percent contraction in domestic borrowings, according to the Treasury data.

At end-August, total borrowings of the government from local creditors reached P1.041 trillion, down from P1.929 trillion a year ago.

Domestic borrowings were mainly through the sale of government securities, composed of Treasury bonds and Treasury bills.

External borrowings also decreased in the first eight-months by 26 percent from P458.51 billion to P337.79 billion.

At end-August, program loans hit P136.6 billion, while projects loans totaled P55.31 billion.

The government also secured P117.32 billion worth of finning through the sale of global bonds and P28.55 billion Samurai bonds.

In August alone, the government borrowed P133.33 billion, up 13 percent compared with P117.56 billion in the same month last year.

Of that amount, domestic borrowings amounted to P132.2 billion and foreign financing reached P1.32 billion.

However, the lower borrowings did not stop the government’s outstanding debt to breach the P13 trillion mark in August.

The Treasury bureau reported last Friday, Sept. 30, that the total debt of the national government stood at P13.021 trillion as of August, an increase of 12 percent or P1.379 trillion from P11.642 trillion a year ago.

Of that amount, 68.7 percent was domestic borrowings while 31.3 percent was sourced from foreign creditors.

At end-August, government debt held by local banks rose nine percent to P8.943 trillion from P8.22 trillion in the same month last year.

Meanwhile, outstanding government loans from foreign sources increased 19 percent from P3.422 trillion last year to P4.038 trillion at end-August.