By Bianca Cuaresma
The outstanding public-sector debt (OPSD) as a proportion of local output, or the GDP, has improved to a 17-year low and totaled only P7.3 billion as of end-September last year.
According to the Department of Finance (DOF), the OPSD, a broad measure of the state of indebtedness of the public sector that includes the national government, fell to only 55.8 percent of GDP, from 60.3
percent a year earlier.
The OPSD covers the general government debt, borrowings of both the 14 nonfinancial public corporations and the financial public corporations minus the so-called intrasector debt holdings.
The DOF attributed the improvement in the country’s OPSD-to-GDP ratio to successes in streamlining the operations of the various government-owned and -controlled corporations (GOCCs). “We will continue to closely monitor GOCC debt to ensure they remain healthy and resilient from external volatility. Over the past six years, we have seen our GOCCs get their acts together. As long as there’s still room for improvement, you can expect the government to continue pushing for progress,” Finance Secretary Cesar V. Purisima said.
Despite the increase in the general government debt—which includes the national government, the Central Bank Board of Liquidators, social-security institutions and local government units (LGUs) net of intrasector debt holdings—the OPSD still ended lower as of September 2015 compared to last year.
The DOF attributed this development to higher national government or GOCC deposits with the government financial institutions (GFIs) and the corresponding increase in government GFI deposits with the Bangko Sentral ng Pilipinas.
In addition, “There was a drop in the outstanding obligations of the 14 monitored GOCCs,” the DOF said.
Meanwhile, the nonfinancial public corporations’ debt decreased by P81.4 billion. This was attributed to the improved liquidity position of the Power Sector Assets and Liabilities Management Corp.
The combined borrowings of financial and nonfinancial public corporations as a share of GDP also declined to 19 percent, from 23 percent of last year that the DOF attributed to “sturdy economic growth.”
The OPSD ended the third quarter with a mixed portfolio of 68.9-percent debt sourced from domestic creditors and the remaining 31.1 percent from external creditors.