Government debt piles up to P19.6 trillion in August

MANILA, Philippines — The national government’s outstanding debt climbed to a new record high of P19.61 trillion at the end of August as fresh borrowings and a weaker peso pushed up both domestic and foreign obligations.

The debt stock grew by 1.1 percent from P19.39 trillion at end-July, according to data from the Bureau of the Treasury (BTr). It was also 12.2 percent higher than the P17.47 trillion recorded in August last year.

National government debt refers to the total outstanding obligations of the government from borrowings in the domestic and international markets. These funds are used to help finance government spending when revenues are insufficient to cover expenditures.

Of the total debt stock, 67.5 percent came from domestic sources while the remaining 32.4 percent was owed to foreign creditors.

“The overall expansion reflected the combined effects of financing activities and valuation adjustments from foreign exchange movements,” the BTr said.

Domestic debt increased by one percent to P13.24 trillion from P13.11 trillion in July. It was also 9.5 percent higher than the P12.09 trillion recorded a year earlier, based on the Treasury’s accompanying data.

The month-on-month increase was largely due to P127.85 billion in net issuances of government securities — or Treasury bills and bonds sold by the government to raise funds.

A weaker peso also added P2.52 billion to the peso value of onshore dollar bonds, which are dollar-denominated government securities issued in the domestic market.

External debt, meanwhile, rose by 1.3 percent to P6.37 trillion from P6.28 trillion in July. Compared with August 2025, foreign obligations were up by 18.3 percent.

The increase largely reflected a P90.32-billion upward revaluation of foreign currency-denominated debt as the peso weakened against the dollar.

When the peso depreciates, the local-currency value of debt denominated in dollars and other foreign currencies rises even if the amount owed in foreign currency does not change.

The government also recorded P2.86 billion in net external loan availments. These increases were partly offset by a P5.93-billion reduction resulting from favorable movements of other currencies against the dollar.

The peso-dollar exchange rate used in valuing the debt weakened to 62.209 per dollar in August from 61.327 in July and 57.042 a year earlier.

Separately, national government guaranteed obligations edged up by 0.2 percent to P306.74 billion from P306.14 billion in July.

Guaranteed obligations are debts of government-owned entities and other borrowers for which the national government has committed to pay if the original borrower cannot.

The slight increase came mainly from a P720-million revaluation of external guarantees, partly offset by repayments on domestic and foreign guarantees.

Despite the monthly uptick, guaranteed debt was 11 percent lower than the P344.57 billion recorded at the end of 2025.