Government settles P1.95 trillion debts in 11 months

Over 96% of 2024 program

MANILA, Philippines — The Marcos administration hiked its debt payments to P1.95 trillion in the 11 months to November 2024, settling over 96 percent of its programmed obligation for last year.

Latest Bureau of the Treasury data showed that the government increased its debt payments by more than a quarter from the P1.53 trillion recorded in the same period of 2023.

As of end-November, the government has settled 96.25 percent of its total programmed debt service for 2024, which is set at a record P2.03 trillion. The programmed debt payments are divided into a 77:23 mix in favor of domestic creditors.

The bulk of the debt payments during the period, or about P1.25 trillion, went to amortization, while the remaining amount of P705.334 billion went to interest payments.

Amortization payments during the reference period rose by 29 percent year-on-year from P967.09 billion recorded in the same period in 2023. The government has already paid 99 percent of its programmed amortization for 2024 of P1.26 trillion.

Meanwhile, interest payments rose by 24.25 percent from P567.66 billion in 2023. The government has already paid 92 percent of its P763.44-billion programmed interest payments for last year.

Spending on amortization goes to returning the loan principal, while interest payments go to complying with interest obligations.

For amortization, the bulk of the amount at 81.5 percent, amounting to P1.018 trillion, was remitted to domestic creditors. The remaining P230.973 billion in principal payments went to foreign sources.

More than 70 percent of the interest payments at P502.389 billion were issued to domestic creditors.

Broken down, the government paid the interest for P325.99 billion in fixed-rate Treasury bonds, P134.738 billion in retail T-bonds and P30.412 billion in Treasury bills (T-bills).

The Treasury sells government securities every week to generate funding for public programs and projects.

Short-dated T-bills have tenors of 91 days, 182 days and 364 days while long-term T-bonds have maturities of up to over 20 years.

Aside from payment to local lenders, the government settled P202.945 billion in interest owed to foreign financiers in the 11-month period.