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THE NATIONAL Government\u2019s (NG) debt servicing expenses significantly escalated year over year in April as amortization disbursements more than doubled, the Bureau of the Treasury (BTr) disclosed.<\/p>\n
Information from BTr indicated that the debt servicing expenses surged by 73.72% to P280.9 billion in April, up from P161.7 billion during the same month the previous year.<\/p>\n
On a monthly basis, the debt servicing expenses also increased by 53.2% from P183.36 billion in March.<\/p>\n
Debt servicing denotes the disbursements made by the government for domestic and international borrowings.<\/p>\n
In April, amortization disbursed reached P234.45 billion, marking a rise of 148.89% from P94.2 billion in the same month in 2024.<\/p>\n
A significant portion of debt disbursements in April was comprised of amortization payments, according to BTr data.<\/p>\n
Principal payments on domestic obligations skyrocketed by 208.23% to P169.83 billion in April compared to P55.1 billion a year earlier.<\/p>\n
Payments for amortization on foreign obligations rose by 65.27% to P64.63 billion in April from P39.1 billion in the corresponding month of 2024.<\/p>\n
Conversely, interest payments decreased by 31.19% to P46.45 billion from P67.5 billion a year prior.<\/p>\n
Domestic interest disbursements fell by 34.37% to P30.47 billion in April from P46.43 billion in the same month last year. <\/span><\/p>\n This was composed of P21.3 billion in fixed-rate Treasury bonds, P3.84 billion in Treasury bills (T-bills), and P3.58 billion in retail Treasury bonds and other instruments (P1.76 billion).<\/p>\n Interest payments for foreign borrowings decreased by 24.17% to P15.98 billion in April from P21.07 billion a year earlier.<\/p>\n Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort stated that the rise in debt servicing was primarily attributed to the P140-billion Treasury bond payments made in early April.<\/p>\n \u201cHowever, there will be relatively large NG debt\/Treasury bond maturities from August to September 2025 which will require principal payments by that time,\u201d Mr. Ricafort commented in a Viber message.<\/p>\n Mr. Ricafort also noted that the rate reductions from the Bangko Sentral ng Pilipinas and the US Federal Reserve towards the end of 2024 may have contributed to lowering NG interest expenses. <\/span><\/p>\n YEAR TO DATE Amortization disbursements plummeted by 62.19% to P335.47 billion in the January-to-April period from P887.24 billion, accounting for 53.85% of the four-month subtotal.<\/p>\n Amortization payments on domestic debt fell by 77.42% to P170.4 billion, while external payments increased by 24.61% to P165.07 billion.<\/p>\n Meanwhile, interest payments grew by 10.35% to P287.45 billion in the January-to-April timeframe compared to P260.49 billion during the same period a year ago. <\/span><\/p>\n Interest payments for domestic obligations amounted to P209.03 billion, up 12.8% year-over-year from P185.31 billion in 2024.<\/p>\n This included P146.13 billion in fixed-rate Treasury bonds, P43.21 billion in retail Treasury bonds, P16.08 billion in Treasury bills (T-bills), and others (P3.63 billion).<\/p>\n Conversely, external debt saw a minor increase of 4.3% to P78.42 billion in the first four months from P75.18 billion a year earlier.<\/p>\n \u201cThe maturity of government securities triggered the increase in debt payments for the government, particularly in government bonds,\u201d stated Reinielle Matt M. Erece, an economist at Oikonomia Advisory and Research, Inc., in a Viber message.<\/p>\n Mr. Erece anticipates that debt payments will escalate in the upcoming months.<\/p>\n \u201cThe government debt servicing expenses may keep rising in the next several months as government securities experience high demand due to upcoming maturities. Additionally, the long-term fiscal consolidation strategy of the government can also account for heightened debt payments aimed at alleviating the country’s debt burden,\u201d he explained.<\/p>\n In 2025, the debt servicing framework is projected at P2.051 trillion, comprising P1.203 trillion in principal payments and P848.031 billion in interest payments.<\/p>\n The NG debt stock reached a new high of P16.75 trillion as of the end of April, and it is anticipated to hit P17.35 trillion by the year’s conclusion.<\/p>\n The debt-to-gross domestic product (GDP) ratio rose to 62% as of the end of March \u2014 the highest level in 20 years.<\/p>\n \u201cThe nation remains firmly on track to lower the NG debt-to-GDP ratio to below 60% by the conclusion of the President\u2019s term,\u201d the Department of Finance stated last week. \u2014 A.R.A. Inosante<\/b><\/p>\n
\n<\/b>Meanwhile, for the first four months of the year, the NG debt servicing bill was recorded at P622.92 billion, representing a 45.73% decrease from P1.15 trillion during the same timeframe last year.<\/p>\n