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By Chino S. Leyco, Reporter
THE Department of Finance said Thursday that it
expects the country’s debt ratio to fall to manageable level in
the next two years.
In a presentation, the Finance department said
the country’s debt to gross domestic product (GDP) ratio is
expected to drop below 50 percent by 2010. The debt to GDP ratio
measures a government’s ability to service its obligations and is
a closely monitored indicator of its fiscal health.
Last year, the country’s debt-to-GDP ratio
stood at 55.8 percent from 63.8 percent in the previous year. The
ratio is expected to fall further to 52.4 percent this year.
The finance department earlier said the country
was on its way to bringing down its debt below 50 percent of the
economy as improving tax collection has allowed it to depend less on
borrowings.
Data from the Bureau of Treasury showed that in
the first four months of the year the country’s financial
obligations stood at P3.871 trillion, or 0.7 percent lower than the
P3.900 trillion outstanding in the same period last year.
The end-April debt level, likewise, was P7.7
billion lower than the P3.881 trillion outstanding in the first
three months of this year.
Of the total debt outstanding at end-April,
P2.301 trillion was owed to domestic creditors, while the remaining
P1.570 trillion was due to foreigners.
Month on month, the domestic debt increased P15
billion on net issuances of government securities. Foreign debt,
meanwhile, dropped P24 billion from end-March due to P17 billion in
net repayments and P20 billion in appreciation of third currencies
against the US dollar.
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