Dennis Gaviola

Photo illustration of US dollar to PH peso exchange in this photo taken on September 30, 2022. Gigie Cruz, ABS-CBN News

Article (news)

Arthur Fuentes

ABS-CBN News

MANILA — The country&#x27;s debt remains manageable under the proposed P7.2-trillion national budget for 2027, the Department of Budget said in a statement on Monday. “Our debt remains manageable, and debt servicing is explicitly provided for in the budget, “ said Acting Budget Secretary Kim De Leon during a Development Budget Coordination Committee (DBCC) congressional briefing.The Philippines is set to add P1.7 trillion to the country’s debt next year to bridge a projected budget gap, as planned spending outstrips expected revenues. The country’s debt already reached P19.07 trillion last June, and is seen to hit P19.75 trillion by the end of the year. The total debt is forecast to rise further to P21.48 trillion at the end of 2027. De Leon, however, said the proposed 2027 budget reflects a disciplined spending strategy to sustain government operations, invest in long-term development, and fulfill our fiscal obligations.“At the same time, our medium-term fiscal program is designed to gradually narrow the deficit while protecting growth-enhancing and socially important expenditures,” De Leon added.The DBM said the P7.2-trillion spending plan reflects this priority by increasing Capital Outlays by 13.8 percent to P1.16 trillion. Meanwhile, Maintenance and Other Operating Expenses (MOOE) drop by 1.2 percent to P2.94 trillion, and Financial Expenses rise to P1.114 trillion to cover scheduled interest payments. Despite higher debt-servicing costs, De Leon assured lawmakers that public debt is under control.“Our approach is therefore not to sacrifice growth simply to reduce the deficit overnight. We are pursuing a strategic and gradual fiscal consolidation path that allows us to honor our obligations, maintain fiscal credibility, and continue investing in our people and our economy,” the Budget Secretary continued.<div>&#x27;INHERITED DEBT&#x27;</div>Finance Secretary Frederick Go supported the DBM&#x27;s stance.“When the Marcos Jr. administration assumed office in 2022, it inherited a massive P12.79 trillion debt. The bulk of which was incurred from pandemic spending. So, when the economy began to recover, the challenge before the Administration was clear: to rebuild fiscal space, while continuing to support economic recovery and investing in the country’s long-term growth,” Go noted.“We project a deficit-to-GDP ratio of 5.44 percent in the second half of 2026, bringing the full year to 5.45 percent, our lowest deficit-to-GDP ratio since the start of the Administration. This continued reduction in the deficit is an important indicator that the fiscal discipline we are pursuing is translating into concrete results,” Go added.“And because we continue to manage our fiscal deficit responsibly, our debt levels remain sustainable,” the Finance chief added.Economic managers have said that the country’s rising debt should not cause worry as long as the economy keeps growing at a fast pace. GDP growth, however, has been <a href="https://www.abs-cbn.com/news/business/2026/8/16/marcos-sees-higher-spending-to-bolster-ph-growth-rate-by-year-end-2224" rel="noopener noreferrer" target="_blank">disappointing</a> in the last few quarters as government spending contracted amid a massive corruption scandal, and private sector investment stalled amid global economic headwinds.

The country's debt remains manageable under the proposed P7.2-trillion national budget for 2027, the Department of Budget said.

The country's debt remains manageable under the proposed P7.2-trillion national budget for 2027, the Department of Budget said.

PH debt ‘manageable,’ says DBM as govt eyes borrowing P1.7 trillion in 2027

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PH debt ‘manageable,’ says DBM as govt eyes borrowing P1.7 trillion in 2027

Arthur Fuentes,

ABS-CBN News

Published August 17, 2026 05:36 PM PHT

Read More:

national debt

sovereign debt

DBM

DOF

Kim De Leon

Frederick Go

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