Manila - The Philippine national government's debt payments increased by 15 percent in September, according to a report by the Bureau of the Treasury (BTr). The total debt service bill for the month amounted to PHP238.9 billion, a significant rise from PHP206.9 billion in the previous year.
According to Philippines News Agency, The report showed that over half of the September payments were allocated for amortization, with principal payments reaching PHP167.5 billion, a 13.9 percent increase from last year. The breakdown of payments included PHP148.8 billion to domestic lenders and PHP18.6 billion to foreign creditors. Interest payments also rose by 19.3 percent to PHP71.4 billion, with domestic debt interest payments reaching PHP55.8 billion. This included payments on fixed-rate Treasury bonds, retail Treasury bonds, and Treasury bills. Interest on foreign debt amounted to PHP15.5 billion, higher than the previous year's PHP12.1 billion. Cumulatively, for the first nine months of the year, debt payments reached PHP1.4 trillion, comprising PHP940 billion in principal payments and PHP460.1 billion in interest payments. Rizal Commercial Banking Corporation chief economist Michael Ricafort attributed the higher debt service bill to increased government debt maturities and factors like higher US interest rates and a weaker peso exchange rate against the US dollar. Ricafort anticipates that these factors will continue to influence the national government's debt service bill in the coming months, though he noted that lower government bond maturities in the fourth quarter of 2023 to February 2024 could somewhat reduce the debt bill during this period.