The Philippines’ debt as a share of economic output is expected to remain elevated above 60 percent of gross domestic product (GDP) this year as the government ramps up borrowings to support its response to the national energy emergency amid the prolonged war in the Middle East.

Based on the results matrices midterm update of the Philippine Development Plan (PDP) 2023-2028 published on the website of the Department of Economy, Planning, and Development (DEPDev) last week, the Marcos Jr. administration expects the outstanding national government (NG) debt stock-to-GDP ratio to peak within the 60- to 63-percent range this year before easing to 59 to 62 percent in 2027 and 58 to 61 percent by the time President Ferdinand R. Marcos Jr. steps down from office in 2028.

The latest Bureau of the Treasury (BTr) data showed that at the end of the first quarter of 2026, the NG’s debt-to-GDP ratio further rose to 65.2 percent, the highest since the 65.7 percent recorded in 2005.

Meanwhile, the DEPDev document showed that the updated PDP targets the general government (GG) debt stock-to-GDP ratio to rise to 55.6 percent this year before easing to 55.4 percent in 2027 and 54.7 percent in 2028.

The latest Department of Finance (DOF) data showed that GG debt stood at 53.9 percent of GDP as of end-2024.

As Manila Bulletin earlier reported, the latest Global Debt Monitor of the Washington-based Institute of International Finance (IIF) showed that the Philippines’ GG debt-to-GDP ratio further increased to 59.6 percent in the first quarter of 2026 from 58.8 percent a quarter ago and 57.2 percent a year ago.

The updated PDP 2023-2028, which serves as the current administration’s medium-term socioeconomic blueprint, last year adopted the GG debt ratio as a core indicator for its plan to reduce the country’s public debt burden.

GG debt is also the metric monitored by credit-rating agencies for ratings actions because it excludes intra-government debt holdings.

Earlier, the Washington-based multilateral lender International Monetary Fund (IMF) urged the Philippines to exercise fiscal discipline and prioritize targeted spending as the country’s GG debt ratio is projected to breach a critical threshold amid volatile global energy markets.

The IMF’s latest Fiscal Monitor projected Philippine GG debt to reach 60.2 percent of GDP this year, signaling thinner fiscal buffers that previously helped protect the economy during downturns.

However, earlier this month, Finance Secretary Frederick D. Go, President Marcos Jr.’s chief economic manager, brushed aside concerns over the country’s fiscal position, assuring markets that the government remains financially stable and still has room to borrow further if needed to cushion the economy from energy shocks.

According to Go, the Philippines remains in “a good fiscal position and has room to leverage if it needs to.”

For Go, it would be “correct” to assume that the Philippines’ fiscal buffers remain intact and far from exhausted as the government implements measures to curb the impact of energy shocks on Filipino households and the broader economy.

Also, Go had said that the standard gauge for a sustainable debt threshold is 70 percent of GDP, citing World Bank standards.

As the Middle East conflict drags on, the Manila-based Asian Development Bank (ADB) recently said that it is prepared to extend up to $1.75 billion in additional financing support for its host country amid the economic fallout from global oil price and supply shocks.