The Department of Finance (DOF) is crafting a roadmap for public borrowings to shore up the Philippines’ economic resilience through fiscal discipline and responsible debt management, its new official said over the weekend.
Finance Secretary Ralph Recto vowed to boost economic resilience by practicing fiscal discipline and prudent debt management.
He announced the development of a Philippine medium-term debt management strategy (MTDS) for transparent public borrowings.
The MTDS is a framework developed by the World Bank and International Monetary Fund (IMF) to guide the debt management decisions and operations of government authorities. It links borrowing with macroeconomic policy and helps countries maintain sustainable levels of debt as well as facilitates domestic debt market development.
“This is the debt meter that will inform us on how to secure a future that leads to a stable fiscal position,” he said.
Data from the Bureau of Treasury showed that the country’s debt reached P14.51 trillion as of end-November 2023, up by P27.92 billion from October. Of the total debt, domestic borrowings comprised 69.09 percent and foreign borrowings made up 31 percent.
The national government’s domestic debt amounted to P10.02 trillion, while foreign debt reached P4.48 trillion.
Recto also assured the public that the Maharlika Investment Fund (MIF) would operate in fidelity with the law and fulfill its intended objectives.
He vowed to endorse the immediate passage of key tax reforms endorsed by the President as priority measures to Congress.
“I agree that we need funds to finance growth and our people’s growing needs, and install a system that promotes fair and fast tax administration. These measures will not only finance development but will reduce deficit and our dependency on debt,” he said.
He recognized the recently-enacted Ease of Paying Taxes Act as a valuable addition to the nation’s fiscal toolkit, providing significant benefits for both taxpayers and tax authorities.
Recto also pledged to champion the passage of the Capital Markets Development Act and pursue reforms in public and private pensions, prioritizing the best interests of beneficiaries while ensuring actuarial health and fund sustainability.
Prior to assuming the Finance Secretary role, Recto served as Deputy Speaker of the House of Representatives in the 19th Congress, representing the 6th District of Batangas.
His extensive political career includes three terms in the Senate (from 2001 to 2007 and from 2010 to 2022), where he held key positions such as Senate President Pro Tempore (16th to 18th Congress) and Senate Minority Leader (17th Congress). He started his political career as the representative of the 4th District of Batangas from 1992 to 2001.
As a seasoned legislator, he pursued numerous tax measures and economic reforms meant to address the cost of living, generate meaningful employment, and expand the country’s fiscal space.
Among the major laws he principally authored/sponsored were the Tax Reform for Acceleration and Inclusion Act; the Universal Healthcare Act; the Rice Tariffication Act; the Ease of Doing Business and Efficient Government Service Delivery Act of 2018; the General Tax Amnesty; the Rationalization of Excise Tax on Automobiles; and the Social Reform and Poverty Alleviation Act.
He co-authored the Bayanihan to Recover as One Act and the Bayanihan to Heal as One Act as well as initiated budget priorities that were necessary not only to stem the spread of the virus but also to speed up the economic recovery.
He also supported initiatives intended to soften the impact of an economic downturn, such as the Financial Institutions Strategic Transfer Act and the Corporate Recovery and Tax Incentives for Enterprises Act.
Recto also briefing served as NEDA Secretary in 2008.