Government Debt payments rise to P281 billion in April

MANILA, Philippines — The government jacked up its debt service to about P281 billion in April, with the bulk going to loan principal borrowed from both domestic and foreign lenders.

Data from the Bureau of the Treasury showed the Marcos administration settled P280.9 billion in debts in April, up by almost 74 percent from P161.7 billion in the same month last year.

More than 80 percent of the debt service was for amortization at P234.45 billion, more than double the P94.2 billion paid in the comparative period.

For amortization, 72 percent of the allocation was remitted to domestic creditors amounting to P169.83 billion.

The remaining P64.63 billion in principal payments were made to foreign sources.

On the other hand, interest payments dropped by 31 percent to P46.45 billion from P67.5 billion in April 2024.

About 66 percent of the interest payments at P30.47 billion were issued to domestic creditors.

Broken down, the government paid the interest for P21.3 billion in fixed-rate Treasury bonds (T-bonds), P3.58 billion in retail T-bonds and P3.84 billion in Treasury bills (T-bills).

The Treasury sells government securities every week to generate funding for public programs and projects.

Short-dated T-bills have tenors of 91 days, 182 days and 364 days while long-term T-bonds have maturities of up to over 20 years.

Aside from payment to local lenders, the government settled P15.98 billion in interest owed to foreign financiers in April.

Spending on amortization goes to returning the loan principal, while interest payments go to complying with interest obligations.

From January to April, debt payments slipped by 46 percent to P622.92 billion from P1.15 trillion in 2024.

The four-month amortization payment at P335.47 billion is lower by 62 percent than the P887.24 billion in the comparative period last year.

Interest payments picked up by 10 percent to P287.45 billion.

As of end-April, the government has settled 30.4 percent of its total debt service for 2025 which is at a record P2.05 trillion.

This year, the government intends to spend P848.03 billion for interest payments on a 74:26 mix in favor of domestic creditors. It will also return P1.2 trillion worth of principal to comply with the amortization of debts mostly to local lenders.

The country’s outstanding debt stood at a record P16.75 trillion as of end-April.