Government trims debt to P6.07 T in end-Oct
By Prinz Magtulis (The Philippine Star)
Updated December 8, 2016 – 12:00am
http://www.philstar.com/business/2016/12/08/1651216/government-trims-debt-p6.07-t-end-oct
MANILA, Philippines – Foreign debt settlement more than offset a weak peso in end-October, slightly lowering the government’s debt pile by 0.3 percent to P6.069 trillion from P6.087 trillion in end-September, latest data from the Bureau of the Treasury (BTr) showed.
Broken down, domestic debt rose 0.3 percent to P3.918 trillion, but the increase was offset by the 1.4-percent decline in foreign debt to P2.151 trillion.
Unlike other economic data, debts are better compared on a monthly basis as they add or subtract to an existing pile.
“Liabilities decreased slightly due to currency adjustments and net repayment of external debt,” the BTr said in a statement.
The recent weakening of the peso against the dollar has raised the value of foreign obligations.
For October alone, the average peso-dollar rate used for computation was pegged at 48.485 to $1, slightly down from 48.482 a month ago, data showed.
But other currencies like the euro performed worse than the peso against the greenback, the BTr said, decreasing the value of loans and bonds denominated in those units.
Specifically, direct loans went down 1.1 percent to P835.62 billion, while the amount of foreign-denominated securities declined by a faster pace of 1.6 percent to P1.32 trillion.
“(This) was due to the effect of third-currency depreciation against the dollar that resulted in the reduction of the peso value of third currency liabilities,” Treasury said.
On the domestic front, the BTr said obligations rose “mainly due to the net issuance of government securities,” which amounted to P3.92 trillion.
Peso loans were steady at P598 million.
Separate from the debt pile, the country’s contingent debt also decreased 0.8 percent to P560.65 billion in October due to higher payments and peso movements, data showed.
These liabilities pertain to those the state guarantees to pay in case of default by government-owned and -controlled corporations and financial institutions.
