Resolving debt dilemma, attaining development goals

When President Ferdinand Marcos Jr. assumed office in June 2022, he inherited not only the reins of government but also a formidable fiscal burden — a national debt stock that had ballooned to over 60 percent of GDP under the Duterte administration.

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The sharp rise from just 39 percent of GDP during the Aquino III administration to over 13 trillion pesos by mid-2022 was largely driven by massive pandemic spending and an ambitious “Build, Build, Build” infrastructure program. By 2025, total indebtedness is projected to reach P16.75 trillion — a staggering increase of P6.84 trillion over a 15-year period.

Three years into his term, President Marcos Jr. has articulated a goal of reducing the debt-to-GDP ratio below the 60 percent threshold. This is not merely an accounting target; it is a fundamental step toward ensuring long-term fiscal sustainability and preserving the country’s creditworthiness. Simultaneously, the government also seeks to reduce poverty to a single-digit level by the end of its term in 2028. The challenge lies in doing so without derailing economic growth or neglecting the social safety nets that protect the most vulnerable Filipinos.