The Marcos administration’s total debt payments declined by 65.3 percent in the first quarter of 2025, as it settled significantly smaller amounts of principal payments to domestic lenders, offsetting the relatively negligible increase in interest payments.

Data from the Bureau of the Treasury (BTr) showed that the Philippine government’s total debt financing only amounted to ₱342 billion in the first three months of the year, a reduction of ₱644 billion compared to the ₱986 billion recorded in the same quarter last year.

A sharp drop in principal payments or amortization significantly contributed to the massive decline.It fell to ₱101 billion, starkly contrasting with the ₱793 billion the Marcos administration paid in the first quarter of 2024. This is equivalent to a ₱P692 billion or 87.3 percent drop.

Notably, the government’s payments to domestic creditors declined significantly by 99.9 percent of its ₱699.7 billion worth of payments a year earlier. It only paid ₱576 million in the January-to-March period, steeply dropping from ₱699.1 billion it settled last year.

Foreign lenders, however, received ₱100.4 billion in the first quarter, up 7.5 percent from ₱93.4 billion last year. However, the government’s meager increase in its principal payments to foreign creditors could not offset the massive deflation in domestic payments.

Meanwhile, the government’s interest payments increased to ₱241 billion in the first quarter, from ₱193 billion a year ago. This translates into a 24.9 percent increase year on year.

Both interest payments to domestic and foreign creditors saw increases. It paid ₱178.6 billion to domestic lenders during the period, jumping by 28.6 percent from last year’s ₱138.9 billion worth of domestic payments.

Broken down, ₱124.8 billion of the payments went towards fixed-rate Treasury bonds (T-bonds), ₱39.6 billion to retail T-bonds, ₱12.2 billion to Treasury bills (T-bills), and ₱1.9 billion to other national government obligations.

Its interest payments to foreign debt sources inched up by 15.3 percent to ₱62.4 billion from ₱54.1 billion

Although the trend had already been observed since January, the payment decline was most evident in March, as total debt payments only reached ₱183.4 billion, dropping by ₱350.1 billion or 65.6 percent from ₱533.5 billion last year.

In March, government creditors received only ₱95.2 billion in amortization, down 79.4 percent from ₱462.6 billion a year prior.

Interest payments, however, inched up by 24.3 percent to ₱88.1 billion from ₱70.9 billion in March 2024.

The government reduced its gross borrowings to ₱745.1 billion in the first quarter of 2025, down ₱415 billion from last year’s ₱1.16 trillion. This was mainly due to the absence of a retail treasury bond (RTB) issuance during the period, which had significantly boosted borrowings in early 2024.

According to the BTr, the first-quarter figure was 35.8 percent lower than the government’s gross recorded in the same period last year.

Gross borrowings during the period accounted for 29.2 percent of the government’s total planned borrowings of ₱2.55 trillion for the year.