MANILA – The government borrowings in the first 10 months of the year jumped by 214.45 percent year-on-year primarily due to requirements to address the coronavirus disease 2019 (Covid-19) pandemic.
Bureau of the Treasury (BTr) data show total borrowings as of end-October this year reached PHP2.706 trillion, way higher than the PHP843.482 billion in the same period last year.
Bulk of the financing is accounted for by those sourced domestically, with a net amount of PHP2.259 trillion while the balance of PHP446.46 billion is accounted for by external financing.
Economic managers have set a PHP3-trillion borrowing program each for 2020 and 2021, and domestic fundraising accounts for the bulk at 75 percent through the issuance of treasury bonds (T-bond), treasury bills (T-bills), and retail treasury bonds (TRB), among others.
On the other hand, of the total commercial external loans for this year, EUR 1.2 billion came from the issuance of three and nine-year US dollar-denominated debt papers last January and USD2.35 billion from the sale of 10-year and 25-year bonds last April.
Aside from commercial borrowings, the government is also tapping lending programs of various multilateral companies to further augment Covid-19-related programs.
The Bangko Sentral ng Pilipinas (BSP) has also extended some short-term borrowings to the national government.
It lent the national government a PHP300-billion credit support last March through a repurchase deal for the acquisition of government securities. This was settled last Sept. 29.
Its policy-making Monetary Board (MB) also approved last Oct. 1 the national government’s request for a PHP540-billion provisional advance.
BSP’s Charter authorizes the central bank to extend financial aid to the national government with an amount that is equivalent to 20 percent of the latter’s average revenues in the last three years, which to date is about PHP540 billion.
Finance Secretary Carlos Dominguez IIII said funding augmentation from the central bank is the national government’s reserve option, citing that commercial borrowing remains the main preference. (PNA)
