Debt payments by the Philippine government breached the P1 trillion threshold in the first four-months of the year due to higher interest settlements.

Data from the Bureau of the Treasury showed that the national government's debt servicing reached P1.15 trillion in January to April, or 32 percent higher than the P770.48 billion paid out in the same period last year.

Debt servicing refers to payments of both interest and principal. The debt service burden excludes actual outflows such as rescheduling or refinancing of existing debt and conversion of debt to equity.

Interest payments rose 38 percent to P260.48 billion at end-April 2024 from P188.23 billion a year earlier.

Of the total, domestic and foreign interest payments reached P46.42 billion and P21.06 billion, respectively.

Payment of principal, on the other hand, swelled by 52 percent to P887.24 billion in the first four months from P582.24 billion last year, consisting of domestic payments of P754.77 billion and foreign payments of P132.47 billion.

The end-April debt payments account for 34 percent of the P2.57 trillion program for the full year of 2024 of which, P1.9 trillion is earmarked for domestic debt while the remaining P640 billion is for foreign creditors.

In April, however, debt payments amounted to P94.19 billion, down 40 percent from P158.51 billion in the same month last year.

The government paid P67.49 billion in interest during the month, and P94.19 billion in principal.

Earlier, the Treasury bureau reported a decrease in borrowing by the Marcos administration from both domestic and foreign lenders in April this year.

Gross borrowings during the month reached P89.20 billion, down by 31.3 percent compared with P129.91 billion a year earlier.

Meanwhile, the Marcos administration’s gross borrowings from January to September increased P1.16 trillion percent, higher compared with the P1.08 trillion in the same period last year.

As of April 2024, the total outstanding debt stock of the national government reached P15.02 trillion.