THE government’s debt service bill fell by more than 73% in August, the Bureau of the Treasury (BTr) said.

According to Treasury data, total debt payments declined 73.42% year-on-year to P31.58 billion. The August total was also much lower than the P92.46 billion worth of payments made in July.

Interest payments accounted for 62.1% of total payments, or P19.61 billion, down 30.71% from a year earlier.

Some 53.39% of interest payments or P10.47 billion went to foreign creditors.

Amortization fell 86.78% year-on-year to P11.97 billion in August.

Amortization on domestic debt was P8.783 billion, of which P8.679 billion was accounted for by the Treasury’s Bond Sinking Fund, while the remaining P3.187 billion went to foreign lenders.

The government borrows from both domestic and foreign lenders to pay for public projects and programs not covered by its ability to generate revenue.

In the eight months to August, the government made P509.295 billion in debt payments, accounting for 57.36% of the total P887.91 billion debt service program for 2019, based on the Budget of Expenditures and Sources of Financing (BESF) report.

Some P258.65 billion went to amortization while P250.65 billion was paid to settle interest payments. — Beatrice M. Laforga