THE government’s debt service bill surged in November with large principal payments representing the retirement of maturing debt, according to the Bureau of the Treasury (BTr).
The national government made debt payments of P221.844 billion that month, up 473% from the record year-earlier level of P38.688 billion. In October, debt payments were P25.202 billion.
Some 92.2% represented amortization of P204.557 billion, also well up on the P14.028 billion a year earlier.
Principal repayments to domestic creditors accounted for P197.37 billion, of which P197.2 billion represented redemptions from the Treasury’s bond sinking fund (BSF).
Foreign amortization, which includes prepaymens made due to bond exchange transactions, stood at P7.187 billion.
Meanwhile, interest payments made in November accounted for 7.7% of the total or P17.287 billion. A year earlier, the corresponding payments amounted to P24.66 billion.
Interest payments to domestic lenders totaled P13.939 billion while those to foreign creditors amounted to P3.348 billion.
In the 11 months to November, the debt service bill was P805.264 billion, or 91% of the P884.29 billion target for the year, according to the Budget of Expenditures and Sources of Financing (BESF) report.
The 11-month payments included P473.512 billion in principal payments and P331.752 billion to settle interest obligations.
The government borrows from both domestic and foreign lenders to plug the funding gap and pay for its expenses not covered by its ability to generate revenue. — Beatrice M. Laforga
