By Chino S. Leyco

The national government’s (NG) debt increased by double-digits in August this year due to higher local borrowings and stronger US dollar against the local currency, data from the Bureau of the Treasury showed yesterday.

The outstanding debt of the national government stood at P7.104 trillion at end-August this year, up by 10.5 percent compared with P6.431 trillion in the same month last year.

Of the total debt stock, 64.37 percent was borrowed from the domestic market, while the remaining 35.63 percent was secured from foreign sources.

Local debt amounted to P4.573 trillion, up by 10 percent compared with P4.151 trillion a year before. Month-on-month, domestic obligations declined by 0.6 percent from P4.6 trillion.

The decline in domestic debt was due to the net redemption of government securities amounting to P27.77 billion, but was slightly offset by the depreciation of the peso that increased the value of onshore dollar bonds by P160 million.

Year-to-date, domestic debt increased by 2.96 percent.

Foreign debt, meanwhile, rose by 11 percent to P2.531 trillion in August from P2.279 trillion in the same month last year.

Month-on-month, external liabilities also jumped by 3.6 percent from P2.443 trillion in July due to net availments of foreign loans amounting to P72.3 billion including the successful issuance of Samurai bonds.

Currency fluctuations on both dollar and third-currency denominated debt added P14.48 billion and P1.10 billion, respectively. From the end-December 2017 level, external debt has increased by P319.76 billion or 14.5 percent.

Likewise, total guaranteed obligations of the national government increased by P1.07 billion month-on-month to P484.97 billion in August due to currency fluctuations on both dollar and third-currency denominated guarantees amounting to P1.75 billion and P0.89 billion, respectively.

These were tempered by net redemption on domestic and external guarantees amounting to P1.27 billion and P0.30 billion, respectively. From the end-December 2017 level, guarantees have increased by P6.86 billion or 1.4 percent.