Debt service bill reaches 1.2 trillion pesos in 2021

By on March 13, 2022 0

The NATIONAL government’s debt service bill jumped by a quarter to 1.2 trillion pesos in 2021 as amortization payments increased, according to data from the Bureau of the Treasury (BTr).

The BTr said government debt payments rose 25% from 962.5 billion pesos the previous year. Last year’s total was just below the debt service budget of 1.28 trillion pesos for 2021.

In December alone, the debt service bill stood at 69.9 billion pesos, down 5% from the same month in 2020.

Amortization payments accounted for 60.9 percent of the total debt service bill in December, after falling 11.9 percent to 42.66 billion pesos.

Major payments to foreign creditors that month amounted to 6.3 billion pesos, while those to domestic lenders totaled 36.36 billion pesos.

Meanwhile, interest payments in December rose 7.9% to 27.33 billion pesos.

Broken down, interest paid on domestic debt totaled 24.18 billion pesos, up 2.4% year-on-year.

These payments consisted of P12.79 billion in retail treasury bills, P9.2 billion in fixed rate treasury bills and P1.07 billion in treasury bills.

On the other hand, interest paid on foreign debt jumped 82.6% year-on-year to reach 3.14 billion pesos.

The government borrows from foreign and local sources to fill its budget deficit as it spends more than it earns to support programs that will spur economic growth.

As for the year 2021, amortization payments accounted for 64.3% of the total debt service bill, with the rest going to interest payments.

Amortization payments during the period jumped 33.1% to 774.73 billion pesos.

Broken down, major payments made to external sources reached 237.19 billion pesos, up 67.4% year-on-year. Those made to domestic lenders increased by 22% to P537.54 billion.

On the other hand, interest payments at the end of last year increased by 12.9% to reach 429.43 billion pesos.

Interest paid on domestic debt in 2021 reached 333.34 billion pesos, jumping 19.5% year-on-year. On the other hand, interest payments on the foreign debt fell by 5.2% to 96.1 billion pesos.

Government borrowing reached P2.58 trillion in 2021, down 5.9% year-on-year. — JPIbanez