In May, the Philippine government significantly ramped up its debt payments, totaling nearly P69 billion. This marked a substantial increase of 40.6% from the previous year’s P49.05 billion. The majority of these payments, amounting to P61.1 billion, were allocated to interest obligations, reflecting a sharp 48% rise from the prior year’s P41.34 billion. In contrast, principal repayments saw a modest uptick of 2.3%, reaching P7.88 billion compared to P7.7 billion in May 2023.
Domestic creditors received approximately 75% of the interest payments, totaling P46.07 billion. This included P26.5 billion for fixed-rate Treasury bonds (T-bonds), P16.87 billion for retail T-bonds, and P2.08 billion for Treasury bills (T-bills). These government securities are regularly issued to raise funds for various public initiatives, with short-term T-bills spanning 91 to 364 days and long-term T-bonds extending beyond 20 years.
Meanwhile, foreign creditors were paid P15.03 billion in interest and P7.8 billion in principal repayments during May. Notably, the total debt payments for the first five months of 2024 surged by 48% year-on-year, amounting to P1.22 trillion, with amortization payments climbing by 52% to P895.13 billion. Interest payments for the same period rose by 40%, reaching P321.59 billion.
As of the end of May, the government had already settled 64% of its total debt service for the year, amounting to a record P1.91 trillion. This amount includes P670.47 billion earmarked for interest payments and P1.24 trillion for principal repayments, primarily to domestic lenders. The country’s outstanding debt reached an all-time high of P15.3 trillion by May’s end, largely attributed to currency depreciation impacting foreign debt liabilities.
