BUSINESS
Advocates Philippines
Philippine National Debt Hits P16.09 Trillion By November 2024: What You Need To Know
FILE
Manila, Philippines – It's no secret that managing a country's finances is a balancing act, and as of the end of November 2024, the Philippine government's total outstanding debt reached a staggering P16.09 trillion. This marks a 0.4% increase from the previous month, or about P70.70 billion more, thanks to new financing needs and the weakening of the peso against the dollar.
Breaking Down the Numbers
Let's talk about where this debt is coming from. A significant chunk of it—67.87% to be exact—comes from domestic sources. This means the government owes most of its debt to local creditors, mainly through various securities. By the end of November, domestic debt was at P10.92 trillion, a slight 0.3% increase from October, primarily due to more issuances of government securities and the peso's depreciation.
On the flip side, external debt, which makes up 32.13% of the total, stood at P5.17 trillion. This saw a bigger bump of 0.8% or P38.88 billion from the previous month, driven largely by the peso's weakening against the dollar. Net foreign loan availments also played a role in pushing this figure up.
Why the Peso Matters
You might be wondering why the peso's value has such an impact. Well, when the peso loses value against the dollar—from P58.198 at the end of October to P58.602 in November—it means that any debt the government has in foreign currencies gets more expensive when calculated in pesos. This exchange rate shift alone accounted for a P35.61 billion increase in the peso valuation of foreign debt.
Year-Over-Year Growth
Looking at the bigger picture, domestic debt has risen by 9.0% since December 2023, adding nearly P904 billion. External debt, meanwhile, has surged by 12.4% over the same period, adding P571 billion to the tab. These increases reflect the government's ongoing efforts to finance public spending and infrastructure projects, as well as the impact of global economic conditions.
What About Guarantees?
On top of this, government-guaranteed obligations—a fancy term for debts backed by the government to support certain projects or entities—totaled P422.04 billion by the end of November. This is a 2.5% increase from October, mainly due to new domestic guarantees and currency movements.
The Road Ahead
Managing this growing debt will continue to be a priority for the government, especially as it juggles the needs of public investment and fiscal sustainability. While these numbers might sound daunting, they’re part of the complex world of national finance, where borrowing is a tool for growth when used wisely.
So, as we move into 2025, keeping an eye on these trends will be key to understanding the economic landscape of the Philippines.
Breaking Down the Numbers
Let's talk about where this debt is coming from. A significant chunk of it—67.87% to be exact—comes from domestic sources. This means the government owes most of its debt to local creditors, mainly through various securities. By the end of November, domestic debt was at P10.92 trillion, a slight 0.3% increase from October, primarily due to more issuances of government securities and the peso's depreciation.
On the flip side, external debt, which makes up 32.13% of the total, stood at P5.17 trillion. This saw a bigger bump of 0.8% or P38.88 billion from the previous month, driven largely by the peso's weakening against the dollar. Net foreign loan availments also played a role in pushing this figure up.
Why the Peso Matters
You might be wondering why the peso's value has such an impact. Well, when the peso loses value against the dollar—from P58.198 at the end of October to P58.602 in November—it means that any debt the government has in foreign currencies gets more expensive when calculated in pesos. This exchange rate shift alone accounted for a P35.61 billion increase in the peso valuation of foreign debt.
Year-Over-Year Growth
Looking at the bigger picture, domestic debt has risen by 9.0% since December 2023, adding nearly P904 billion. External debt, meanwhile, has surged by 12.4% over the same period, adding P571 billion to the tab. These increases reflect the government's ongoing efforts to finance public spending and infrastructure projects, as well as the impact of global economic conditions.
What About Guarantees?
On top of this, government-guaranteed obligations—a fancy term for debts backed by the government to support certain projects or entities—totaled P422.04 billion by the end of November. This is a 2.5% increase from October, mainly due to new domestic guarantees and currency movements.
The Road Ahead
Managing this growing debt will continue to be a priority for the government, especially as it juggles the needs of public investment and fiscal sustainability. While these numbers might sound daunting, they’re part of the complex world of national finance, where borrowing is a tool for growth when used wisely.
So, as we move into 2025, keeping an eye on these trends will be key to understanding the economic landscape of the Philippines.
Jan 7, 2025
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