MANILA, Philippines — The governments debt stock fattened in January amid a fresh round of borrowings meant to meet the countrys growing needs in the middle of pandemic recovery.

Data released by the Bureau of Treasury showed that the states outstanding debt levels grew 2.1% month-on-month to P13.7 trillion as of end-January. Of the total debt stock, 68.5% came from domestic sources while 31.5% came from foreign creditors.

The debt piles ascent came about as the peso recovered lost ground against the US dollar, offering some respite from foreign currency-denominated loans.

Experts have been warning about the impact of a growing debt pile for the Philippines. The countrys debt stock climbed at the onset of the pandemic, due in part to the Duterte administrations borrowing spree to fund its pandemic response.

A plump debt stock would mean more taxpayers funds are needed for debt servicing in the coming years. The situation also means that the Marcos Jr. administration would run the government and institute reforms with a very tight fiscal space.

Even then, Finance secretary Benjamin Diokno reiterated in December that the countrys liabilities were still “manageable”, arguing that outstanding obligations have long payment terms. The countrys debt-to-gross domestic product ratio settled at 60.9% in 2022, breaching the 60% threshold deemed manageable for emerging market economies.

Broken down, domestic borrowings expanded 1.9% month-on-month to P9.38 trillion in January. The national government borrowed P179.16 billion from local creditors. This offset the pesos strength against the dollar, which amounted to P2.61 billion.

External debt rose 2.4% month-on-month to P4.31 trillion. Foreign loans (P186.56 billion) secured by the national government and forex adjustments amounting to P10.36 billion pushed the levels up.