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Manila Bulletin devider Business devider Banking & Finance devider Marcos' debt bill surges to record as interest costs balloon

Marcos' debt bill surges to record as interest costs balloon

Published Mar 16, 2026 12:00 am  |  Updated Mar 14, 2026 01:53 pm
The national government’s debt service burden surged to a record ₱2.1 trillion last year, as the administration of President Ferdinand Marcos Jr. grappled with ballooning interest costs that now consume an increasing share of the budget.
Data from the Bureau of the Treasury (BTr) showed over the weekend that total debt settlements for January to December last year rose 4.1 percent from ₱2.02 trillion in the previous year.
Debt service also continued a steep upward trajectory. For context, total debt payments have more than doubled since 2020, when they stood at ₱962.5 billion.
As of 2025, the country’s interest payments increased by 13.2 percent to ₱864.1 billion from ₱763.3 billion in 2024, largely driven by higher payments to local lenders.
Interest payments to domestic creditors climbed 17.6 percent to ₱634.846 billion from ₱539.8 billion in 2024.
Interest payments on government securities grew across major categories. Fixed-rate treasury bonds (T-bonds) rose to ₱416.8 billion from ₱340.5 billion in 2024; retail treasury bonds (RTBs) increased to ₱162.7 billion from ₱153.9 billion; and short-dated treasury bills (T-bills) climbed to ₱45 billion from ₱32.7 billion.
Conversely, the government’s other domestic obligations saw interest payments decrease to ₱10.4 billion from ₱12.7 billion in 2024.
Interest payments on foreign debt posted a modest increase to ₱229.3 billion from ₱223.5 billion a year earlier.
Overall, interest payments accounted for 41.1 percent, or roughly two-fifths, of total debt service for 2025.
Meanwhile, amortization—nearly three-fifths (58.9 percent) of the total—fell slightly by 1.5 percent to ₱1.24 trillion in 2025 from ₱1.26 trillion in 2024.
In particular, the government reduced its principal payments to foreign lenders by 6.5 percent to ₱223.7 billion from ₱239.3 billion, while amortization to domestic lenders remained relatively stable, dipping marginally to ₱1.01 trillion from ₱1.02 trillion in 2024.
It bears noting that despite the highest-ever debt payments, the NG’s total outstanding debt also climbed to a new record of ₱17.71 trillion during the period, driven by additional borrowings to fund projects and the peso’s continued weakening against the United States (US) dollar and other currencies.
Recall that the government failed to keep borrowings within its end-2025 target of ₱17.36 trillion, overshooting the ceiling by more than ₱350 billion.
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