THE National Government’s total debt payments surged in August due to higher amortization of local debt, the Bureau of the Treasury (BTr) reported.

This brought the debt service bill for the January to August period to P760.65 billion, already three-fourths of the programmed P1.005-trillion debt payments for the entire year.

Latest data from the Treasury showed government debt payments jumped 383% to P152.396 billion in August alone from the P31.581 billion paid in the same month a year ago. This was also 150% higher than the P60.91 billion logged in July.

Principal payments made up 85% of the total, with the rest going to interest payments.

Amortization payments skyrocketed by 985% to P129.85 billion in August from P11.97 billion a year ago. Of the total, P127.79 billion was paid to domestic creditors which is 1,354% bigger year on year.

Principal payments on foreign debt, however, slipped 35% to P2.057 billion.

Meanwhile, interest payments went up 15% to P22.549 billion, 87% of which went to local creditors.

Interest paid for domestic debt was at P19.6 billion, broken down into P12.296 billion for the Treasury bonds, P5.156 billion for retail Treasury bonds and P2.07 billion for Treasury bills.

In the eight months to August, the total debt service bill was 49% up from the P509-billion tally in the same period last year. The bulk or 65% went to settle principal debt.

Amortization payments jumped 90% to P491.05 billion during the eight-month period.

Payments for the principal of its domestic debt accounted for 76% of the total at P374 billion, while the balance of P117 billion was paid to external creditors.

Interest payments rose 7.56% to P269.6 billion, with 70% or P188.5 billion going to local creditors.

In 2019, total debt payments reached P842 billion, up 16% year on year.

The government plans to borrow P3 trillion from both domestic and foreign lenders this year to plug the budget deficit which is seen widening to 9.6% of gross domestic product. — B.M. Laforga