Strong demand for securities fuels domestic borrowing surge
The national government’s outstanding debt grew 11.5 percent in June from a year earlier, driven mainly by higher domestic borrowing to fund the budget gap and finance key operations, the Treasury said.
Government debt stood at P17.27 trillion as of end-June, up from P15.48 trillion a year earlier, the Bureau of the Treasury (BTr) reported on Wednesday, attributing the uptick to “strong investor demand for government securities.”
Month-on-month, the debt pile climbed by P348.45 billion or 2.1 percent from May’s P16.92 trillion.
Domestic borrowings made up 69.2 percent of total debt, or P11.95 trillion, up 13 percent year-on-year. External debt reached P5.32 trillion, up 8.3 percent from P4.91 trillion in June 2024.
“This strategy aligns with the government’s thrust to deepen the local capital market, reduce foreign exchange risks, and build investor confidence in Philippine-issued securities,” the Treasury said.
Meanwhile, guaranteed obligations remained broadly stable at P345.11 billion in the first half of 2025 — a 0.4 percent uptick from last year. Of that amount, P254.47 billion was domestic and P90.64 billion came from external sources.
The treasury said the manageable level of guaranteed debt reflects the administration’s commitment to balancing contingent liabilities with economic growth — part of its “prudent debt management strategy” for long-term fiscal sustainability.
“Every peso borrowed is used to build a stronger economy,” the BTr said.
The Department of Finance (DOF), for its part, noted that the Philippines’ general government debt-to-GDP ratio stood at 57.1 percent in 2024 — comfortably within the median range for Asean and emerging markets.
It added that the debt ratio would remain below the 60 percent threshold throughout the Marcos administration.
