2007 budget reveals programmed borrowings just for payment of existing debt

The vicious debt cycle is once more grossly apparent in the 2007 budget.As the Lower House wraps up its budget deliberations before its month-long recess starting tomorrow, Bayan Muna Rep. Teddy Casino bared the country's lamentable debt situation as reflected in the proposed 2007 budget."Seventy-seven and a half percent (77.5%) of the amount to be borrowed for 2007 will be used to refinance existing debt," bared Casino."In nominal terms, PhP303.8 billion of the total PhP390.79 billion scheduled borrowing for 2007 will be used to pay our existing debt, which is projected to be up to PhP3.755 trillion by end of next year, up by 2.15% from this year's total national government debt pegged to reach PhP3.675 trillion by end of this year," the young solon furthered."Hence, we are borrowing to pay for our existing debt while deceptively projecting to the world that we are financially capable of paying debts, allowing us to borrow even more as the years come," the activist-solon exclaimed.The burgeoning debt service budget is eating government financial resources, which should go to social services. According to Bayan Muna estimates culled from the 2007 budget, every Filipino pays PhP19.53 per day for payment of 2007 debt service payments. In exchange, the government spends a measly PhP0.3 per Filipino per day--not even enough to buy half a tablet of aspirin.Casino likewise scored Malacanang's celebration over the decrease in debt interest and principal payments for next year."It's like giving a child a piece of candy for her birthday and calling it a grandiose celebration. It's pathetic," the party-list solon quipped."While official figures show that debt servicing for interest payments dipped 3.31% and principal amortization dipped 20.39%, the total debt burden still stands at a critical level--more than half of the country's economy--standing at 56% of the GDP," Casino explained.Bayan Muna proposes that debt servicing be slashed by at least PhP22.7 billion to finance MDG-related activities proposed by the Minority. ###