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The Economy and COVID-19
The Economy and COVID-19
The COVID-19 Pandemic brought undeniable effects on economies worldwide, the Philippines being no exception. Some immediate effects to the country include a significant decline in revenue due to the unforeseen circumstances that affected the economy, a wider fiscal deficit due to increased spending happening along with the drop in revenue, and a general increase in the public debt (Debuque-Gonzales et al., 2023). At the end of the former President Duterte’s term, near the end of June 2022, the debt has reached ₱12.79 trillion according to the Bureau of the Treasury (BTr), which has increased since the ₱12.5 trillion that was recorded on May of the same year (Cordero, 2022).
2010s
2010s
Debt Stabilization and Economic Growth
2020-Present
2020-Present
Pandemic-Driven Debt Surge
State of the debt before the Pandemic
State of the debt before the Pandemic
2010-2016: During President Benigno Aquino III’s administration, economic growth accelerated, with improved fiscal discipline. National debt remained manageable as a percentage of GDP, hovering around PHP 5-6 trillion by 2016, with debt-to-GDP ratios falling below 45%. The government focused on local borrowing to minimize foreign exchange risks.
2016-2019: Under President Rodrigo Duterte, infrastructure spending was prioritized under the “Build, Build, Build” program. Debt grew to approximately PHP 7.7 trillion by 2019, but debt-to-GDP ratios remained manageable due to strong economic growth.
State of the debt after the Pandemic
State of the debt after the Pandemic
2020-2021: The COVID-19 pandemic triggered a sharp rise in national debt due to increased government spending on health measures, social programs, and economic stimulus. By the end of 2020, the national debt surged past PHP 10 trillion, as borrowing intensified to address the pandemic.
2021: The debt further increased to PHP 11.7 trillion by December 2021, pushing the debt-to-GDP ratio to over 60%, a significant rise from pre-pandemic levels.
2022: Debt grew to around PHP 13.42 trillion by December 2022, largely due to ongoing pandemic recovery efforts and increased infrastructure spending
2023: By the middle of 2023, the national debt stood at around PHP 14.15 trillion. Economic recovery efforts have begun to stabilize the debt situation, but inflation, interest rates, and external conditions remain critical factors for future debt management
Graph showing the debt from when COVID-19 was considered a pandemic in the Philippines to its end in USD (CEIC, 2024).
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