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DEBT
service in the proposed 2008 budget is 24.1 percent
lower than the 28 percent this year because of a
stronger peso, Budget Secretary Rolando Andaya Jr.
reported on Monday.
Andaya
said in a press statement that under the draft 2008
P1.227-trillion national budget, interest payments take
up P295.8 billion, or P22.3 billion less than this
year’s P318.1 billion programmed debt service payments.
“The dip
in debt service is dramatic. Instead of remitting money
to our creditors, we will be remitting that to our
people in terms of infrastructure, health service and
education. The challenge now is how to make everyone
feel the positive effects of these rechannelled funds.”
Andaya
said that the amount was calculated on a P46 to P48 to
$1 exchange rate, which he added is a “band that is
admittedly conservative because traditionally, we are
prudent in making forex assumptions.”
Andaya
said the estimated amount may even go lower should the
peso continued to gain strength from its current level
of P45 to $1.
Andaya
said that because of the decreased debt service, the
government can provide more funds for social services
and other “productive components” in the budget.
“This is
evident in the proposed rise of social services spending
from P325.5 billion this year to P385.8 billion next
year. The share of the economic services sector will
also increase by P33.5 billion, to P280.2 billion next
year.” |
