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Stronger peso trims NG debt

Joshua Lao

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Borrowings made by the national government was largely domestic with 66.49 percent of its total stock comprised by local loans. AFP

The indebtedness of the National Government (NG) improved in September, latest data from the Bureau of Treasury (BTr) show.

“The NG outstanding debt stood at P7.90 trillion as of the third quarter 2019, P31.39 billion or 0.4 percent lower than the previous month due to currency fluctuations and net repayment of both external and domestic loans,” the BTr reported.

Also, borrowings made by the NG remained largely domestic as 66.49 percent of its total stock was comprised by local loans while the remaining 33.51 percent was sourced from offshore markets.
NG domestic debt, however, amounted to only P5.25 trillion, a 0.3 percent decline from P5.27 trillion in August.

“For the month, the lower level of domestic debt was due to the combined net redemption of government securities amounting to P14.37 billion and the P0.17 billion effect of peso appreciation on onshore dollar bonds,” the BTr said.

“Since the beginning of the year, domestic debt has increased by P480.90 billion or 10.07 percent, while the year-on-year increment was P669.99 billion or 14.60 percent,” it added.
Likewise, foreign obligations decreased 0.6 percent from P2.66 trillion to P2.64 trillion.

“The decline in external debt was attributed to local and third-currency fluctuations which decreased the value of foreign debt by P17.09 billion and P7.80 billion, respectively,” the Treasury said.

According to the BTr, the reduction in foreign debt tempered the net availment of similar loans reaching P8.03 billion for the period.

The total NG guaranteed obligations or debt contracted by public entities that become direct NG obligations at default, decreased by P5.85 billion or 1.2 percent month-on-month to P484.43 billion in September.

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