A steep reduction in principal settlements led to a sharp slide in the government’s debt servicing in October, even as interest costs inched higher during the month.
Figures from the Bureau of the Treasury showed that total payments to both domestic and external lenders amounted to P65.78 billion in October, a plunge of almost 70 percent compared with the same month a year earlier. The cumulative tally from January to October has reached P1.93 trillion, representing 91 percent of the P2.1-trillion debt servicing program set for 2025.
The dramatic pullback in October stemmed mainly from amortization, which sank to P8.41 billion from P161.46 billion in the comparable period last year. That portion of the debt bill represented about 13 percent of all payments for the month. Overall amortization for the first 10 months, however, totaled P1.2 trillion, only slightly lower than the level recorded in 2024.
Domestic lenders received just P2.48 billion in principal payments for the month, markedly below the P120 billion settled in the same period last year. Despite the slowdown, domestic amortization from January to October remained close to P1 trillion, almost matching the previous year’s figure.
The government also reduced what it owed to foreign creditors, paying P5.9 billion in October versus P41.46 billion a year earlier. This brought external amortization to P202.4 billion in the 10-month period, down from P239.3 billion a year ago.
With principal payments shrinking, interest charges accounted for the bulk of October’s debt service. The government disbursed P57.36 billion in interest for the month, slightly higher than the P55.38 billion paid last year. For the January-to-October period, interest costs reached P723.21 billion, up from P638.68 billion in the same stretch of 2024.
