Every Filipino owes P59K in debts because of PH’s domestic and foreign loans

Every Filipino owes P59K in debts because of PH’s domestic and foreign debts

PH’s P5.9-trillion outstanding debts

Each Filipino, babies and adults alike, owes around P59,000 in foreign and domestic debts, because the Philippines now has P5.9-trillion in outstanding debts based on estimates released by the Department of Budget and Management (DBM), said Rep. Terry Ridon of the Kabataan party-list in a report on InterAksyon.

With the country celebrating the arrival of the 100 millionth Pinoy just a week ago, this means that each and every member of the population will owe a projected total of P59,121 by the end of the year.  This is broken down into P18,989 in foreign debt and P40,132 in domestic debt.

Every Filipino owes P59K in debts because of PH’s domestic and foreign debts

Government plans to borrow P700.8 billion more

So, what are the government’s plans to ease the country’s debts, anyway?  Apparently, none, says Ridon.  Instead of trying to find a way to pay up these loans to ease up our burdens, the government is finding more reasons to make new loans.

Ridon said the government continues to create “ambitious national budgets” annually, but continually relies on debts to cover these expenses.

For 2015, the government increased its budget by 15.1 percent: from the current P2.265 trillion budget to P2.606 trillion, reveals Ridon.

Government plans to make a loan to pay for past loans

No matter how hard the DBM tried to come up with the amount to cover the P2.606 trillion budget, only P2.337 trillion could be placed in the budget from various revenues, including tax and non-tax sources. So, what will the government do?

According to the report, the government plans to make a new loan of P700.8 billion.  More than half of the new loan will be used to pay for the outstanding national government debt, says Ridon.  Amounting to P390.4 billion, this supposed portion of the money could only cover the amortization for the principal and does not include interests.

So, aside from still having loans from the previous loans, the new loan will be added to the country’s current debts.  Ridon also questions why the Palace keeps talking about “savings” when the country is still deep in debt.

World Bank lowers growth forecast

According to a report on Yahoo! News, the World Banks maintains that the Philippines continues to be among the fastest growing economies in East Asia; however, they lowered the growth forecast from 6.4 percent (previously 6.6) this year and 6.7 percent (previously 6.9) next year.

The revision was made because of the slower growth seen, especially in the aftermath of Typhoon Yolanda [Haiyan], plus stricter monetary policy from January to July, and slower government spending from April to June, says bank officials.

On a positive note, they said the country is on the right track, as seen by “significant reductions in poverty”, which suggests sustained high growth.