The national government borrowed over a trillion pesos in the first half of the year, significantly less than the level recorded a year ago.
Latest data from the Bureau of the Treasury (BTr) showed the government’s gross borrowings from January to June this year stood at P1.07 trillion, plunging by 44.6 percent from P1.93 trillion in the comparable period in 2021.
The bulk of the amount as of end-June consisted of gross domestic borrowings which settled at P741.26 billion, a 55-percent drop from P1.65 trillion.
The lion’s share of gross domestic borrowings during the six-month period came from Fixed Rate Treasury Bonds (P535.28 billion), followed by Retail Treasury Bonds (P457.8 billion). There was also a net debt redemption on Treasury Bills amounting to P251.92 billion as more debts were repaid than borrowed.
Data from the BTr also showed that gross foreign borrowings in the first six months of the year rose by 15.58 percent to P329.3 billion from P284.95 billion a year ago.
Of the total, program loans and multi-tranche dollar-denominated global bonds amounted to P136.6 billion and P117.3 billion, respectively.
The remaining amount was borrowed through a project loan (P46.85 billion) and through the issuance of yen-denominated Samurai bonds (P28.55 billion).
For the month of June alone, the national government borrowed P146.17 billion, lower by 12.6 percent from last year’s P167.2 billion.
Gross domestic borrowings also declined by 28.7 percent to P96.45 billion in June this year from P135.29 billion recorded in the same month a year ago.
Gross foreign borrowings, however, hit P49.72 billion, surging by 55.8 percent from P31.91 billion in June 2021.
For this year, the government is set to borrow a total of P2.2 trillion, the bulk of which would still come from domestic sources.
As of end-May, the national government’s outstanding debt dipped to P12.5 trillion from a record-high of P12.76 trillion as of end-April due to its repayment of its short-term interest loan from the Bangko Sentral ng Pilipinas.
Finance Secretary Benjamin E. Diokno earlier said the government would not borrow as much as it did during the Covid-19 pandemic as the government pursues fiscal consolidation to bring down its debt-to-GDP ratio.
The national government’s debt-to-GDP ratio as of the first quarter rose to 63.5 percent, the highest since the country’s debt as a percentage of the economy hit 65.7 percent in 2005 under the Arroyo administration.
Diokno said the government expects the country’s debt-to-GDP ratio to reach 61.8 percent by the end of the year and to taper down until it reaches 52.5 percent in 2028, the end of the term of President Ferdinand R. Marcos Jr.
While Diokno said the government is not in a hurry to quickly return to the country’s historic low pre-pandemic debt ratio of 39.6 percent, he said the government will prioritize supporting economic growth in order for the country to outgrow its debt.