Philippines to pay P2.17 billion daily for debt - Recto

MANILA, Philippines - The government's interest and principal payments on its debts will climb to an all-time high of P791.5 billion next year or a daily disbursement rate of P2.17 billion, Senate President Pro Tempore Ralph Recto said.

Recto said interest payments for 2014 has been programmed at P352.7 billion, or 15.6 percent of the proposed P2.268 trillion budget.  Meanwhile, the allocation for principal amortization for next year amounted to P438.8 billion.

But while the debt service next year reaches an all-time high, Recto said the "good news" is that share of interest payments in the national budget "has been falling sharply."

"This is a very impressive markdown compared to what we were coughing up 10 years ago when interest payments were eating up 35 percent of the national budget," Recto said.

"Gone are the days when one-third of the budget was remitted to our creditors," Recto said.

Of the 352.7 billion earmarked for interest payments for 2014, P248.4 billion will be for domestic liabilities while P104.3 billion will be for foreign debt.

Next year's interest payments expense is bigger by  P20.5 billion or  a 6.2-percent hike to the P332.2 billion allocated this year.

Principal payments on foreign debt, on the other hand, will range from P85.8 billion to P89.9 billion, depending on the US dollar-Philippine peso exchange rate which for 2014 budgeting purposes was pegged at P41-43 per US$1.

As of April 2013, the national government's outstanding debt stood at P5.309 trillion, an amount representing 48.9 percent of the gross domestic product.