Amortization drives NG debt payments over ₧1T By Reine Juvierre S. Alberto
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A NEW EXCHANGE OF FIRE WITH IRAN IN GULF TESTS THE FRAGILE CEASEFIRE
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HE national government spent over P1 trillion in the first four months of the year to pay for its debts, as amortization more than doubled and outpaced interest payments. Debt payments surged by 68.92 percent to P1.052 trillion from January to April this year, compared to the P622.921 billion in the same period last year, according to data released by the Bureau of the Treasury (BTr). Ruben Carlo O. Asuncion, chief economist at UnionBank of the
Philippines, said the “sharp rise” in debt servicing appears to be largely driven by timing effects. “[This] is not unusual for a single month and does not necessarily signal underlying fiscal stress,” Asuncion told the BusinessMirror. The increase in debt servicing was fueled by amortization, which reached P715.634 billion in endApril. The repayment of principal loans grew by 113.32 percent from P335.474 billion in the same period a year ago. Asuncion said the maturity of government securities tends to create “lumpiness” in amortiza-
tion payments. Domestic amortization rose by 269.92 percent year-on-year to P630.367 billion from P170.403 billion. Meanwhile, amortization paid to foreign creditors declined by 48.34 percent to P85.267 billion from P165.071 billion. On the other hand, interest payments grew by 17.11 percent to P336.656 billion in end-April from P287.447 billion in the same period last year. Both domestic and external interest payments posted a 21.64-percent and 5.04-percent year-on-year increase, respectively. Local lenders were paid
P254.285 billion in interest payments, of which P185.330 billion were for fixed-rate Treasury bonds, P47.317 billion for retail Treasury bonds and P17.087 billion for Treasury bills. Foreign financiers were also paid P82.371 billion during the four-month period. “While the uptick in interest payments should be monitored, the overall spike is best viewed as a reflection of scheduled obligations rather than a structural concern,” Asuncion said. For April alone, the government’s debt payments amounted See “Debt,” A2
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By Andrea E. San Juan @andreasanjuan
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HE country’s foreign reserves, its buffer against external shocks, dropped to a 16-month low as of the end of May, due to lower gold holdings and foreign investments amid increased market volatility due to the Middle East conflict. Preliminary data from the Bangko Sentral ng Pilipinas (BSP) showed the country’s gross international reserves (GIR) level settled at $103.97 billion as of end-May 2026, the lowest since January 2025. This is 0.34 percent lower than the $104.33 billion recorded in end-April 2026. Year-on-year, the GIR fell by 1.14 percent from the $105.18 billion in end-May 2025. In a statement, the BSP said the month-on-month decrease in re-
serves was mainly driven by the national government’s drawdown on its foreign currency deposits with the Bangko Sentral ng Pilipinas (BSP) for external debt service. Other reasons behind the decline are the downward valuation adjustments in the BSP’s gold holdings due to decline in global gold prices and BSP’s net foreign exchange operations. For his part, Jonathan L. Ravelas, senior adviser at Reyes Tacandong & Co., said: “The See “GIR,” A2
MAY GLOBAL UREA PRICES SOAR 97%; PHL TALKING TO CHINA By Ada Pelonia @adapelonia
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NTERNATIONAL quotations for urea, a key farm input imported by the Philippines, soared nearly two-fold in May, according to the World Bank. Figures from the World Bank showed that global urea prices leaped by almost 97 percent to $770.5 per metric ton (MT) last month, from the $392 per MT recorded in May 2025. Despite the surge posted yearon-year, average urea prices in the reference month fell by 10
percent from $856.88 per MT in April. Meanwhile, DAP prices continued their rally, averaging $769.5 per MT in May, 15 percent higher than $669.2 per MT in the same period last year. The Middle East war, which resulted in the closure of the Strait of Hormuz, triggered supply disruptions in the Persian Gulf and jacked up prices of fertilizers. The Gulf region is a critical supplier of fertilizers, especially urea, which is heavily reliant on natural gas. See “Urea,” A2
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RAISING THE STANDARD Philippine flags line stretches of Maharlika Highway in Sto. Tomas City, Batangas, ahead of the country’s 128th Independence Day on June 12, 2026. The observance commemorates the 1898 declaration of independence from Spanish colonial rule, led by Emilio Aguinaldo, a defining milestone in the nation’s path to sovereignty. The display runs through a high-traffic corridor where jeepneys, buses, tricycles, delivery vans, and freight trucks operate in constant flow—making transport activity highly exposed to fuel price movements that continue to influence fares, logistics costs, and consumer prices across the wider economy. ROY DOMINGO
High-quality jobs key to cutting poverty By Justine Xyrah Garcia
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REATING more highquality and productive jobs is critical to building a resilient Filipino middle class and sustaining the country’s poverty reduction gains, the Department of Economy, Planning and Development (DepDev) acknowledged. Speaking at the launch of the World Bank’s Poverty and Equity Assessment report, Socioeconomic Planning Secretary Arsenio M. Balisacan said the government remains focused on reducing poverty, but recognizes that many Filipino households remain vulnerable to economic shocks. Official data showed that poverty incidence declined to 15.5 percent in 2023 from 18.1 percent in 2021,
but Balisacan noted that many households continue to face risks from food price volatility, health emergencies, climate-related disasters, and labor market disruptions. “While we remain focused on our efforts to reduce poverty, we acknowledge that recent economic disruptions continue to challenge our economy. The government is carefully calibrating its strategies to ensure that we meet our development objectives,” he said. To help more Filipinos achieve economic security, Balisacan said the government is prioritizing the creation of quality jobs under the Philippine Development Plan 2023-2028. The push for quality employment comes as the World Bank recently found that 95 percent of poverty
reduction between 2012 and 2023 came from Filipinos moving into wage employment outside agriculture and fisheries. However, productivity growth has remained weak, limiting the creation of higher-quality jobs that could help more Filipinos attain middle-class status. Balisacan said sustaining inclusive growth will require policies that promote competition, encourage innovation and investment, and strengthen labor market institutions that balance worker protection with flexibility and adaptability. “Building a resilient middle class is therefore more than a social aspiration. It is a socioeconomic imperative that underpins robust domestic demand, broadens the country’s tax base, supports human capital
investment, and strengthens social cohesion and institutional stability,” he also said. Apart from generating quality employment, Balisacan said the government must also improve public service delivery, strengthen resilience against emerging risks, and enhance economic governance. The country’s chief economist also called for addressing persistent disparities in health, education and nutrition outcomes, particularly in remote areas, through stronger local institutions, more effective fiscal transfers, and better implementation capacity. According to Balisacan, building a predominantly middle-class society requires creating conditions that provide Filipinos with greater See “Poverty,” A2
PESO EXCHANGE RATES n US 61.6350 n JAPAN 0.3853 n UK 82.7635 n HK 7.8676 n CHINA 9.0985 n SINGAPORE 48.0135 n AUSTRALIA 43.9642 n EU 71.5952 n KOREA 0.0402 n SAUDI ARABIA 16.4172 Source: BSP (June 5, 2026)