Debt-to-GDP ratio, which refers to government debt as a percentage of gross domestic product, is one of the closely watched indicators by international credit rating agencies as it demonstrates a country’s ability to pay off its debts. A lower debt-to-GDP ratio is generally perceived as favorable — an indicator of a robust economy — as it shows that a country is producing enough to be able to repay its debts.
From 2016 to 2017, the Philippines’ debt-to-GDP ratio was 42.1%, down from 44.7% in 2015. The 2016-17 ratio is the lowest level since 1996, the earliest year for which comparable data is available.
• Debt-to-GDP ratio rises to 56.2% in Q1 ahead of Fed rate hikes
• ADB confident PHL can handle Chinese debt load
• General government debt at 36.4% of GDP
• Debt to remain at ‘prudent levels,’ DBCC says