Analysts see timing, frontloading moves
The national government’s gross borrowings from January to April 2025 dropped by 2.39 percent to P1.135 trillion from P1.163 trillion a year earlier, primarily due to a sizable decline in local debt, the Bureau of the Treasury (BTr) said.
As of Sunday, the BTr website showed domestic borrowings were down by 19.58 percent to P835.51 billion in the first four months of 2025 from P1.039 trillion in the year-earlier period. The four-month 2025 domestic borrowings even included a P300 billion issue of Treasury notes in April.
Meanwhile, external debt jumped by 141.49 percent as of the end of April to P299.692 billion from P124.099 billion in the comparative year-earlier period. This was due to global bonds issued in February, amounting to P191.965 billion.
Of the total domestic borrowings by the Philippine government, P469.4 billion came from the issue of fixed-rate treasury bonds, and P66.11 billion from treasury bills. The balance came from treasury notes.
Apart from the triple-tranche global bond issue in February, external borrowings during the four months consisted of P22.527 billion in project loans and P85.2 billion in program loans.
April 2025
In April 2025 alone, the government’s gross borrowings surged by
more than 337 percent to P390.06 billion from P89.202 billion a year earlier.
Domestic borrowings swelled more than 367 percent to P384.71 billion from P82.36 billion a year earlier, while funds owed to external sources eased by 21.81 percent to P5.35 billion from P6.842 billion in April last year.
‘A timing issue’ — analysts
“The 2.39 percent year-to-date dip in gross borrowings likely reflects a timing-related adjustment in the national government’s borrowing calendar rather than a definitive shift toward fiscal tightening,” John Paolo Rivera, a senior research fellow at the Philippine Institute for Development Studies, said.
“The sharp surge in April, driven by Treasury notes and February’s global bond issuance, suggests the government remains on track with its pre-programmed borrowing plan for the year, balancing fiscal needs with market conditions,” he added.
Rivera said the drop in domestic borrowings, despite the April issuances, could signal frontloading in the first quarter of last year or a preference this year to diversify funding sources, especially as external rates temporarily became favorable earlier in 2025.
“However, it’s important to monitor this closely if domestic borrowing remains subdued while expenditures rise, it could pressure liquidity and interest rates moving forward,” Rivera said.
Michael Ricafort, Rizal Commercial Banking Corp. chief economist, also said the decline in gross borrowings is “largely a timing issue more than anything else.”
“(It’s a) function of the national government frontloading its borrowings to finance the budget deficit,” Ricafort said.
“National government borrowings hedged amid volatility in the global markets due to the Trump factor, as a matter of prudence,” he added.
‘Fiscal consolidation’
Reinielle Matt Erece, economist at Oikonomia Advisory & Research Inc., said the overall decline in borrowings for the year is reflective of the government’s fiscal consolidation plan.
“With the current trend of strong revenue generation from taxes and new tax laws for digital services, I expect a slight slowdown in borrowings as the revenues may be able to support the government’s expenditures,” Erece said.
“Regarding the increase in April borrowings, I may attribute this to strong demand for government securities amid global uncertainty and demand for safer assets such as government bonds,” he added.
