Gov’t debt-to-GDP ratio down to 37.3%

MANILA, Philippines - Total government debt as a percentage of the economy declined further as of September last year, the Department of Finance reported yesterday.

The general government’s debt stood at P4.6 trillion or 37.3 percent of gross domestic product (GDP as of September last year, marking a decline of  2.4 percentage points from 39.7 percent a year ago.

General government (GG) debt refers to the short- and long-term debt of all institutions in the general government sector.

Total GG debt net of national government  was P141.6 billion or 2.9 percent higher than the previous year.  The increase was driven by higher domestic debt, which comprised 62.3 percent of the consolidated total NG obligations.

While the absolute level of debt increased during the period, this was outpaced by the growth of the economy.

“High nominal GDP growth of 9.3 percent contributed in reducing the debt ratio,” the DOF said.

Debt incurred from domestic sources rose 3.7 percent while external debt climbed 1.6 percent.

In contrast, local government debt  fell by 3.1 percent due to a P2.2 billion decline in liabilities.

Social Security Institutions such as the Government Service Insurance System and Social Security System did not contribute to the debt stock  but increased their holdings of government securities by 4.8 percent equivalent to about P22.5 billion.