PH debt climbs to ₱19.07 trillion, 66% of GDP, the highest share since 2004, WR risk report says

MANILA — The Philippines’ national government debt stood at ₱19.07 trillion at the end of June, equal to 66% of gross domestic product and the highest ratio since 2004, according to a new risk assessment by WR Advisory Group.

The Manila-based firm rated Fiscal & Sovereign Risk 16 out of 25, the only “High” among the eight categories in its Q2 2026 Philippine Political & Country Risk Report, and assigned it a “Deteriorating” outlook. The overall country score was 10.375, in the “Elevated” band.

The debt stock already exceeds the ₱19.06 trillion full-year ceiling the report cites, by roughly ₱10 billion, a gap within rounding. Debt service for the first half reached ₱1.23 trillion, about 60% above the ₱768.11 billion of a year earlier and 61% of the ₱2.01 trillion programmed for the full year.

DEBT RATIO

The debt-to-GDP ratio has risen 2.8 percentage points in six months, from 63.2% at the end of 2025 to 65.2% at the end of the first quarter and 66.0% at the end of June. WR attributes the pressure to the debt stock growing faster than the economy, not to a collapse in revenue.

WR’s own medium-term benchmarks look tight against that path. The government’s Development Plan midterm update targets 60–63% for 2026, while projections from Congress’s budget research office (CPBRD) and the Philippine Institute for Development Studies (PIDS) are 63.8% and 65.7%, respectively.

DEBT SERVICE

Debt service includes both interest and principal. WR’s figures show amortization more than doubling, to ₱743 billion from ₱353.29 billion. Subtracting amortization from total debt service implies interest costs of about ₱487 billion against ₱415 billion a year earlier, a rise of roughly 17% (computed from WR figures, assuming debt service is interest plus amortization).

WR cites Fitch Ratings as estimating that interest costs could reach 13% of revenue in 2026, compared with a 9% median for BBB-rated sovereigns.

REVENUE IS MOSTLY ON TARGET

The first-half deficit was ₱786.8 billion, up 2.8% from a year earlier, while revenue reached ₱2.39 trillion, up 5.7%. Collections were mixed: the Bureau of Internal Revenue took in ₱1.63 trillion, 1.4% short of its first-half target, while the Bureau of Customs collected ₱491.9 billion, 7.2% above target. Value-added tax collections rose 10.3% and excise collections fell 2.7%.

TARGETS ARE BEING CUT

In July, the Development Budget Coordination Committee lowered its 2026 growth target to 3.5–4.5% from 5.5–6.5%, trimmed the BIR target by ₱38 billion to ₱3.393 trillion, set total revenue at ₱4.807 trillion, and moved its peso assumption to ₱60–62 from ₱58–60 per dollar. The Department of Finance estimated the worst-case cost of suspending fuel excise taxes at ₱136 billion; Republic Act 12316, signed on 25 March, lets the President suspend the tax when Dubai crude averages $80 a barrel or more.

The risk to watch, WR says, is the combination of a rising debt ratio, a possible downgrade at Fitch and slower growth that shrinks the denominator.