By Justine Irish D. Tabile, Senior Journalist
The outstanding debt of the National Government (NG) increased by P18.16 trillion in late February, indicating a stable and well-controlled position, the Bureau of the Treasury (BTr) said on Wednesday.
The latest data from the Treasury showed that the debt increased by 0.14% from P18.13 trillion at the end of January.
Year-on-year, outstanding debt increased by 9.19% from P16.63 trillion at the end of February 2025.
“The modest increase underscores the government’s stable and well-managed position amid global financial conditions,” BTr said in a statement.
“This is largely motivated by the continued prioritization of domestic financing to protect the government’s debt position from adverse external developments,” it added.
NG debt is the sum of money owed by the Philippine government to lenders such as international financial institutions, developing countries, banks, international bondholders and other investors.
A large amount or 68.7% of the total debt comes from domestic sources, while the rest is foreign loans.
“With domestic debt accounting for 68.7% of the total, NG maintains a smart debt profile that minimizes risk from foreign exchange (forex) volatility,” said BTr.
Domestic debt, made up of government bonds, rose 1.25% to P12.48 trillion at the end of February from P12.32 trillion at the end of January, “as the government issued additional securities amounting to P158.14 billion to raise funds for the development of the country.”
Year-on-year, it jumped 11.19% from P11.22 trillion in the same period.
“The impact of currency movements on domestic securities denominated in foreign currencies remained small, reducing the amount by P3.75 billion,” it added.
Meanwhile, external debt decreased by 2.21% to P5.68 trillion at the end of February from P5.81 trillion at the end of January.
However, the external debt decreased by 5.03% from P5.41 trillion in February 2025.
BTr said the decline was “primarily driven by favorable forex movements, which reduced the value of the peso to the US dollar- and third-currency bonds that included cash by P136.43 billion.”
“This balance achieves more than the total foreign loans available at P7.78 billion,” it added.
The peso closed at P57.665 against the dollar at the end of February, up P1.195 from its P58.860-dollar close at the end of January.
External debt is made up of P2.93 trillion in international bonds and P2.75 trillion in loans.
“Despite the decline in the stock of foreign debt, NG continued to receive strategic foreign financing. As of the end of February 2026, the total foreign capital reached P203.10 billion, including the successful issuance of P2.75 billion of three international bonds with tenors of 5.5, 10, and 25 years,” the statement said.
“This reflects the continued confidence of investors in the country’s credit profile and NG’s ability to tap international markets on the right terms.
Year to date, NG’s external debt increased by P88.98 billion, or 1.59%, from P5.59 trillion at the end of December.
Meanwhile, guaranteed NG obligations increased by 10.11% to P379.98 billion as of the end of February from P345.08 billion in the previous month.
“The increase was mainly due to the new guarantees extended to the Power Sector Assets and Liabilities Management (PSALM) Corp., which was partially affected by the overall payment and good cash flow,” he said.
Michael L. Ricafort, chief economist at Rizal Commercial Banking Corp., said the increase in outstanding debt does not yet reflect the impact of the war in the Middle East, which began in March.
“But it may still partially show that some government has wasted money since the last half of 2025 due to extravagant flood control plans,” he said in a Viber message.
The slight increase, he said, reflects the peso’s strong exchange rate at P57 levels in February “which is in some ways the peso’s equivalent of foreign debt.”
In the coming months, Mr. Ricafort said the budget deficit is expected to widen during the increase in government spending which will require more NG borrowing.
“Furthermore, the record high exchange rate of the US dollar above P60 recently could lead to a higher foreign debt equivalent,” he said.
The Marcos administration has indicated that the outstanding debt will reach P19.06 trillion by 2026. Of this, about 70% or P13.28 trillion is domestic debt, while P5.78 trillion is foreign debt.
