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THE Department of Finance said Wednesday the
government plans to further trim interest payments this year such
that it would bring down this expenditure as a ratio of state
revenues.
Finance Secretary Margarito B.
Teves said the government is eyeing to cut interest payments to 22.8
percent of revenues, from 23.5 percent last year. Debt would also be
cut to 51.7 percent of the economy, as measured by the country’s
gross domestic product (GDP), from 55.7 percent a year ago.
“We are keeping a close watch
on our liability portfolio,” Teves told the Philippines
Development Forum Wednesday.
Interest payments dropped by
P43.27 billion to P266.833 billion last year from P310.104 billion
the previous year. Domestic and foreign interest payments reached
P157.22 billion and P109.613 billion, respectively.
Last year, the government’s
outstanding debt declined to P3.7 trillion or 55.8 percent of GDP
from P3.9 trillion the year before.
The Bureaus of Internal Revenue
and of Customs are expected to raise about P1.1 trillion in tax
revenues this year.
The BIR’s share of the target
this year is 10.3 percent at P845 billion, or higher than last
year’s target of P765 billion, while Customs is tasked to collect
P254 billion or 11.5 percent higher than its P228- billion goal last
year.
About 10.3 percent of revenues
will come from non-tax sources, including P30 billion from
privatization initiatives.
Last year, the government’s
debt servicing reached P613.1 billion, or P241.27 billion lower than
the P854.370 billion paid out the year before.
Debt servicing refers to payments
of both interest and principal. The debt service burden excludes
rescheduling or refinancing of existing debt and conversion of debt
to equity.
The finance department said the
government saved P32 billion at end-November last year in
debt-servicing costs due to low interest rates and a stronger peso.
The lower-than-expected interest
rates meant the government would spend less on debt servicing, both
for domestic and foreign loans, while the appreciation of the peso
trimmed the government’s foreign-currency denominated debt in peso
terms.
Government’s total spending in
the 12-month period reached P1.144 trillion.
The peso averaged 40.65 against
the dollar in January year on year, and has been one of the
strongest Asian currencies since last year.
--Chino S. Leyco
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