Over the weekend, Rizal Commercial Banking Corp. economist Michael Ricafort told The Manila Times the Philippines’ relatively lower debt-to-gross domestic product (GDP) ratio in recent year “gives the Philippine government greater leeway/flexibility to increase spending on stimulus measures and Covid-19 programs.”In particular, the Philippines posted a revised 39.6-percent debt-to-GDP ratio in 2019. This level, he said, would allow the government to increase its budget deficit to 5.3 percent of GDP this year from its 3.2-percent ceiling. This wider budget deficit-to-GDP ratio “could lead to some uptick in the country’s debt-to-GDP ratio to 46 to 47 percent levels,” Ricafort forecasted. His outlook is higher than the government’s adjusted 44.95 percent debt-to-GDP ratio projection for this year. These include tax reform measures that structurally improved recurring tax revenue collections and prudence in cutting unnecessary expenses in recent years.

Source: Manila Times May 03, 2020 16:19 UTC