Debt service grew to P1.293 trillion in 2022 from P1.204 trillion a year ago as a result of higher amortization payments, data from the Bureau of the Treasury showed over the weekend.

The BTr said the government’s debt payments rose 7.4 percent in 2022 from the previous year.

For December alone, debt payments totaled P302 billion.

Amortization payments accounted the most for the total debt service bill in December at P258.5 billion.

Principal payments to foreign creditors that month amounted to P7.4 billion, while those to domestic lenders totaled P36.2 billion. Meanwhile, interest payments in December stood at P43.61 billion.

Broken down, interest paid on domestic debt reached a total of P36.26 billion.

These payments consisted of P27.9 billion in retail Treasury bonds, P6.6 billion in fixed-rate Treasury bonds, and P763 billion in Treasury bills.

On the other hand, interest paid on external debt stood at P7.72 billion.

The government borrows from foreign and local sources to plug its budget deficit as it spends more than it makes to support programs that would stimulate economic growth.

Full-year amortization hits P790B

As for the full-year 2022, amortization payments also made up most of the total debt service bill.

Amortization payments in the period jumped from P774.73 billion to P790.32 billion.

Broken down, principal payments made to external sources reached P130.4 billion. Those made to domestic lenders reached P659.8 billion.

On the other hand, interest payments as of the end of last year increased by 17.09 percent from P429.43 billion to P502.85 billion.

Interest paid to domestic debt in 2022 hit P383.4 billion, jumping by 15.02 percent year on year from P333.34 billion. In contrast, interest payments on external debt increased from P96.1 billion to P130.4 billion.