This paper assesses empirically the sustainability and feasibility of the
government debt in the Philippines using the No Ponzi Game criterion. Both
historical data and forecasts generated by a quarterly macroeconometric model
of the Philippines are used in the assessment. Stochastic simulations are carried
out to mimic future uncertainty. The test results show that, up to the end
of the present administration in 2010, the Philippine government debt is
not sustainable but weakly feasible, that the feasibility is vulnerable to major
adverse shocks, and that simple budgetary deficit control policy is inadequate
for achieving debt sustainability or strengthening feasibility.