The Philippines' national government debt rose from ₱12.79 trillion in 2022 to ₱16.75 trillion in 2025, growing faster than the economy. In 2024 and 2025, nearly 48 to 51 percent of government revenues are used for debt service, limiting funds for education, health, and disaster preparedness.
From 2022 to 2025, the national government debt grew by over 9 percent annually, outpacing the economy's 5 to 6 percent yearly expansion. This has increased the debt burden relative to the country's repayment capacity.
In 2023, total debt service reached ₱1.6 trillion, including ₱610 billion in interest and ₱940 billion in principal. It rose to ₱2.0 trillion in 2024, with ₱670 billion in interest, and stayed at that level in 2025 with annual interest nearing ₱700 billion. As a result, interest payments now take one out of every six pesos of government revenue.
More than 80 percent of the debt is long-term, posing low rollover risk. However, the extended terms create rigidity in future budgets. Projections indicate debt service will remain above 40 percent of revenues until at least 2028.
This situation stems from years of heavy borrowing and weak revenue efforts. Additionally, controversies over budget plunder and misallocation in the past three years exacerbate the issue, leading to higher debt without benefits to growth or services. The integrity of the budget process is crucial for future debt sustainability, alongside revenue reforms and disciplined spending.
