By Luisa Maria Jacinta C Jocson, Reporter

THE NATIONAL Government’s (NG) gross borrowings rose by 22% in February as domestic debt surged, the Bureau of the Treasury (BTr) reported.

Data from the BTr showed that total gross borrowings jumped to P419.973 billion in February from P343.625 billion in the same month a year ago.

Month on month, gross borrowings more than doubled (106.7%) from P203.151 billion in January.

Nearly all of February’s gross borrowings (98.9%) came from domestic sources.

Gross domestic debt climbed by 26.7% to P415.232 billion during the month from P327.641 billion a year earlier.

This consisted of P341.412 billion in retail Treasury bonds (T-bonds), P60 billion in fixed-rate T-bonds, and P13.82 billion in Treasury bills (T-bills).

On the other hand, gross external debt fell by 70% to P4.741 billion in February from P15.984 billion in February 2023. External borrowings during the month were composed entirely of new project loans.

Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said that borrowings in February were significantly higher due to the retail Treasury bond (RTB) issuance.

The government raised a record P584.86 billion from its offering of five-year RTBs in February, exceeding the P400-billion target set by the BTr.

Mr. Ricafort also attributed the rise in borrowings to the wider budget deficit amid high borrowing costs.

Separate data from the BTr showed that the NG’s budget deficit widened by 54.81% to P164.7 billion in February from P106.4 billion a year earlier, driven by a 22.14% surge in state spending.

“This increase in borrowings may be attributed to higher financing needs to support various government programs and initiatives, covering budget deficits, managing local government debt profiles, and implementing subsidy measures due to inflation and El Niño,” Security Bank Corp. Chief Economist Robert Dan J. Roces said in a Viber message.

Meanwhile, BTr data showed that gross borrowings declined by 12% to P623.124 billion in the January-February period from P710.488 billion last year.

External borrowings in the first two months of the year plunged by 67% to P66.387 billion from P203.547 billion in the year-ago period. This was composed of P56.298 billion in program loans and P10.089 billion in new project loans.

Domestic debt stood at P556.737 billion, up by 9.8% from P506.941 billion in the same period a year ago.

Broken down, this consisted of P341.412 billion in retail T-bonds, P190 billion in fixed-rate T-bonds and P25.325 billion in T-bills.

For the coming months, Mr. Ricafort said the upcoming global bond offering could add to NG’s borrowings.

The BTr is finalizing the details of the government’s first global bond offering this year, Finance Secretary Ralph G. Recto said earlier. No details have been released.

“However, an important positive offsetting factor would be the seasonal increase in tax revenue collections in April that could help narrow the budget deficit and NG debt,” he added.

Taxpayers have until April 15 (Monday) to file their annual income tax returns with the Bureau of Internal Revenue (BIR). The agency is expected to collect P405.9 billion during the month.

“The expectation of further increases in borrowings this year depends on several factors, including the country’s economic growth, government budget and expenditure plans, market conditions, and debt sustainability concerns,” Mr. Roces added.

The government’s borrowing program is set at P2.46 trillion, with P1.85 trillion to be raised from the domestic market and P606.85 billion from foreign sources, according to the latest Budget of Expenditures and Sources of Financing data.