An economist said Tuesday the government should intensify tax collection and adopt more disciplined spending as its outstanding debt hit a new all-time high of P13.644 trillion as of end-November 2022.
The Bureau of the Treasury said the figure would have been higher, if not for the recovery of the peso against the US dollar in the fourth quarter.
Data showed the outstanding debt rose from P13.641 trillion in October and P11.931 trillion a year ago.
“For the month, NG’s [national government’s] total debt portfolio marginally increased by P3.15 billion or 0.02 percent from the end-October 2022 level primarily due to the effect of local currency appreciation against the US dollar on foreign currency loans,” the Treasury said in a statement.
The peso appreciated against the US dollar from 58.047 as of end-October to P56.598 as of end-November.
It said outstanding government debt increased by P1.92 trillion, or 16.33 percent, since end-December 2021.
Domestic debt amounted to P9.43 trillion in November, P72.73 billion or 0.78 percent higher than in the previous month, while foreign debt went down by P69.58 billion or 1.62 percent from October because of the P106.98-billion impact of local currency appreciation and P13.38 billion net repayment.
Michael Ricafort, chief economist of Rizal Commercial Banking Corp., said government debt could still go up this year if the government would frontload borrowings in the early part of 2023 to finance the budget deficit, starting with the scheduled foreign borrowings in the first quarter of 2023.
The government’s budget deficit in the first 11 months of 2022 amounted to P1.2 trillion, lower by 7.2 percent or P96.3 billion than in the same period in 2011.
Ricafort said government’s debt swelled by nearly P6 trillion in the past three years amid the pandemic.
“In view of large debt incurred of nearly P6 trillion since the pandemic started in 2020, the new administration may still need to further intensify tax revenue collections based on existing tax laws, come up with new taxes/tax reform measures, increase tax rates, among others to further boost structural sources of government revenues,” he said.
Ricafort said the government might as well adopt more disciplined spending through fiscal reform measures such as right-sizing the government, anti-corruption and anti-wastage measures.
He said these measures would help further narrow the budget deficit and, in turn, slow the growth in the government’s outstanding debt and better prepare for eventual payment of the large debt/borrowings incurred during the pandemic as they fall due in the future.
The Treasury said the net issuance of government securities added P75.76 billion in government’s debt in November, although the peso appreciation trimmed P3.03 billion from the debt stock.
Domestic debt comprised 69.10 percent of the total debt stock, with a year-to-date increment of P1.26 trillion from the end-December 2021 level.
“This was tempered by the net impact of third-currency fluctuations against the US dollar amounting to P50.78 billion. NG external debt comprised 30.90 percent of the total debt portfolio. From end-December 2021 level, NG external debt has increased by P658.07 billion or 18.49 percent,” it said.
Total national government guaranteed obligations also increased by P1.47 billion or 0.38 percent month-on-month to P388.0 billion as of end-November 2022.
The higher level of guaranteed debt was due to the net availment of domestic guarantees amounting to P1.03 billion and the net effect of currency fluctuations that increased the value of external guarantees by P0.44 billion.
The Treasury said that from the end-December 2021 level, government-guaranteed debt was still lower by P35.92 billion or 8.47 percent.