National debt breaches record ₱11 trillion in May

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Metro Manila (CNN Philippines, July 5) — The country's outstanding loans once again reached an all-time high this May as the government borrowed more to finance COVID-19 response measures, data from the Treasury Bureau published Monday revealed.

The national debt stood at ₱11.07 trillion by the end of the month, up by ₱79.81 billion or 0.73% from the previous record ₱10.99 trillion in April.

The latest figure is also a 24.5% spike from the ₱8.89 trillion recorded in May last year.

The Treasury noted that 71.5% of borrowings were made locally. Local debt stock hit ₱7.91 trillion in May, climbing by 1.3% from April as a "result of the net issuance of government securities."

Meanwhile, external debt which comprised 28.5% of total loans was worth ₱23.56 billion during the month. This is 0.74% down from April's level.

The bureau attributed the month-on-month decline to the "₱28.58 billion impact of local-currency appreciation against the US Dollar and the net repayment of foreign loans amounting to ₱0.22 billion."

These likewise offset the ₱5.24 billion revaluation of the peso value of loans denominated in other currencies like the euro and Japanese yen, added the Treasury.

May payment guarantees fell to ₱425.69 billion, a 1.9% drop from the month before, as the net redemption of local and foreign obligations reached ₱5.52 billion and ₱690 million respectively.

Fluctuations of local and third-currency exchange rates also pulled the peso value of external guaranteed debt by ₱1.76 billion and ₱180 million, the bureau added.

Just last month, the Finance Department said the country's debt level is high but still sustainable and manageable. 

With revenues remaining low amid strict lockdown measures, the government has resorted to borrowing both from local and foreign sources to support growing expenditures in combatting the health crisis. The country's fiscal deficit, in turn, jumped to a five-month high in May