Finance Secretary Ralph Recto downplayed concerns about the Philippines' rising national debt, emphasizing that the key lies in the country's ability to repay it, not just the size of the figure.

In a press briefing on Wednesday, Recto said he is not worried about the debt-to-gross domestic product ratio as of the third quarter of 2023 at 60.2 percent.

"Today, at 60 percent, I'm not that much concerned about the national debt. It's your ability to pay that is important," Recto said.

"Nominally, the debt looks high. It's P14.5 trillion, roughly 60% of GDP, which is very manageable," he added.

As of November 2023, the country's total government debt reached P14.51 trillion, reflecting a 0.19 percent increase compared to the P14.48 trillion reported as of October 2023.

Recto outlined a plan to gradually reduce the debt ratio to 51-55 percent by cutting the deficit by 1 percent annually. He sees two avenues for achieving this: increasing revenue and boosting economic growth.

"The idea is to grow the economy faster," Recto explained. "When you grow the economy, you broaden the tax base and collect more taxes. That's the best way to raise more revenue without raising the debt," he added.

Recto not keen on tax reform on junk food and sweetened beverages

Meanwhile, Recto said he is not considering pursuing the imposition of tax reform on junk food and sweetened beverages for now as the country's debt to GDP ratio has improved.

"Inflation is high. When you impose taxes, that is also inflationary. So I don't think now is the time to impose," Recto said in the same briefing.

The finance secretary made a comparison to the debt-to-GDP ratio in the 2000s, specifically noting a surge to 70 percent between 2003 and 2004, followed by a decline to the range of 40 percent in the 2010s.

Because of the need for financial assistance and the initiation of infrastructure projects during the Duterte administration, the Marcos administration was able to inherit a debt of P12.79 trillion.

Hence, former Finance Secretary Benjamin Diokno wanted to introduce taxes on junk food and sweetened beverages.

As a pivotal reform initiative by Diokno, the junk food and sweetened beverages tax program aimed to levy a tax of P10 per 100 grams or P10 per 100 milliliters on pre-packaged foods deemed to lack nutritional value.