As the sun set on 2023, the National Government's (NG) financial landscape was painted with a staggering figure of P14.62 trillion. This outstanding debt marked an increase of P1.20 trillion or 8.92% from the previous year, a testament to the dynamic financial waves of the Philippines.
In the final month, December bore witness to a surge in debt by P107.54 billion or 0.74%, propelled by net availments and exchange rate adjustments. The year's financial curtain call showcased the country's economic resilience and adaptability in the face of mounting obligations.
Despite the evident debt surge, 2023 wasn't all gloomy. The year's Gross Domestic Product (GDP) growth painted a picture of economic progression, registering at an impressive 5.6%. Consequently, the debt-to-GDP ratio saw an improvement, descending to 60.2% from 60.9% at the end of 2022.
This figure not only indicates an economic upturn but also falls below the 61.2% target outlined in the medium-term fiscal framework. This aligns with the persistent efforts to improve debt sustainability, demonstrating the Philippines' commitment to maintaining a stable economic environment.
On dissecting the total debt stock, two significant components emerge - external and domestic debt. The former accounted for 31.5% of the total, while the latter dominated with a hefty 68.5%.
The domestic debt in December 2023, clocking in at P10.02 trillion, saw a rising tide from its level a year ago, increasing by P809.54 billion or 8.79%. However, the month-on-month figures tell a different story, reflecting a decrease of P6.48 billion or 0.06%, attributed to the net redemption of government securities.
In December 2023, the gross issuance of domestic debt totaled P29.69 billion. On the other hand, principal payments amounted to P36.08 billion, culminating in a net repayment of P6.39 billion.
The effect of local currency appreciation against the US dollar on debt stock valuation further trimmed P0.09 billion from the December total, shedding light on the intricacies of managing domestic debt.
The NG's external debt, standing at P4.60 trillion, witnessed an upsurge by P387.86 billion or 9.21% from the end-December 2022 level. This increase was also evident in the month-on-month comparison, showcasing a rise of P114.02 billion or 2.54%.
This escalation was attributed to the net availment of foreign debt amounting to P88.24 billion, which included a USD1.0 billion maiden issuance of Islamic bonds and a disbursement of program loans from ADB amounting to USD300 million.
The currency realm played a significant role in the debt scenario. The impact of third-currency adjustments against the USD added P28.45 billion to the debt, slightly offset by the P2.67 billion effect of peso appreciation against the USD.
These fluctuations underscore the profound influence of currency dynamics on the nation's external debt landscape.
As of end-December 2023, the NG guaranteed obligations stood at P349.44 billion, marking a decrease by P49.61 billion or 12.43% from its end-December 2022 level. The month-over-month comparison also revealed a decline, amounting to P3.70 billion or 1.05%.
The diving figures of guaranteed debt in December could be attributed to the net repayment of domestic guarantees amounting to P7.57 billion. Furthermore, peso appreciation against the US dollar further trimmed P0.10 billion from the total.
These factors more than offset the P1.15 billion net availment of foreign guarantees and the P2.82 billion effect of third currency appreciation on similarly denominated guarantees for the month, presenting a detailed picture of the guaranteed debt dynamics.
2023 was a year of financial twists and turns for the Philippines. From the rising tide of total outstanding debt to the silver lining of GDP growth, the fiscal landscape was marked by resilience, adaptability, and commitment to economic stability.
As we step into the future, it's crucial to remember that every financial decision, every policy, and every currency fluctuation shapes the nation's fiscal story. While 2023 was a year of challenges, it was also a testament to the potential of the Philippines' economy.
No comments:
Post a Comment