THE national government's debt payments for the first five months of the year hit P623.59 billion, a 21.57-percent surge from the same period in 2020.

The government's debt service from January to May this year rose from last year's P512.96 billion as amortization outpaced interest payments, data from the Bureau of the Treasury showed.

Broken down, amortization grew by 26.11 percent to reach P444.99 billion from P352.85 billion in the same five-month period a year ago.

Meanwhile, interest payments from January to May 2021 also climbed to P178.6 billion, an 11.5-percent climb from P160.1 billion last year.

Amortization refers to the repayment of loan principal over time, while interest payment refers to a payment determined by the interest rate of an account.

Under domestic amortization, redemptions accounted for P291.8 billion, mainly comprising payments made to the government's Bond Sinking Fund at P239.15 billion and domestic bond exchange at P51.54 billion.

Amortization payments for assumed liabilities stood at P793 million while P331 million went to agrarian reform beneficiaries.

On the other hand, foreign amortization reached P153.18 billion.

For domestic interest payments, the bulk was spent for fixed-rate Treasury Bonds at P84.27 billion while P37.01 billion went to Retail Treasury Bonds and P10.16 billion to Treasury Bills.

Foreign entities were also paid P46.38 billion in interest payments during the period.

For May alone, the government's debt service bill spiked by 53.4 percent year-on-year to P37.8 billion from P24.64 billion, as interest payments grew at a faster pace than amortization.

Interest payments soared by 57.65 percent to P28.93 billion from P18.35 billion in May 2020.

In the same month, amortization amounted to P8.87 billion, 41 percent higher than last year's P6.29 billion.

This year, the government has programmed P1.79 trillion for its debt service, with P1.26 trillion allotted for principal amortization and P531.55 billion in interest payments.

In 2020, the government spent P962.47 billion to service its debts as it needed to keep up with more financial obligations to fund its war chest against the Covid-19 pandemic.

Outstanding debt of the national government as of end-May this year has already ballooned to a record P11.07 trillion, up by 13 percent from P9.795 trillion as of end-2020.

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