BSP’s Monetary Board OKs $3.32-B foreign borrowings in Q4 2023

By Kris Crismundo and Anna Leah Gonzales

January 22, 2024, 7:59 pm

MANILA – The Bangko Sentral ng Pilipinas (BSP) said Monday the Monetary Board has approved USD3.32 billion worth of medium- to long-term (MLT) foreign borrowings in the fourth quarter of 2023.

The public sector’s foreign borrowings from October to December 2023 jumped by 65.8 percent from the USD2 billion level in the same period in 2022.

This lifted the total MLT foreign borrowings last year to USD14.49 billion, which consisted of 24 MLT borrowings —two bond issuances worth USD4 billion; 12 project loans worth USD5.67 billion; and 10 program loans worth USD4.82 billion.

The external borrowings that were made last year aims to fund the national government’s programs in infrastructure, agriculture, education, economic recovery and development, environment protection and climate resilience, and coronavirus disease 2019 (Covid-19) response.

A big chunk of the foreign borrowings in 2023 will finance the public sector’s infrastructure projects, including transportation projects, amounting to USD4.07 billion.

The government borrowed USD4 billion from foreign sources for its general financing requirements, USD3.07 billion for economic recovery and development, environmental protection and climate resilience projects and programs, and USD2.27 billion for Covid-19 pandemic response projects and programs.

Projects for agriculture and education sectors also respectively got USD880 million and USD210 million from foreign borrowings.

“Under Section 20, Article VII of the 1987 Constitution of the Republic of the Philippines, prior approval of the Bangko Sentral ng Pilipinas, through its MB, is required for all foreign loans to be contracted or guaranteed by the Republic of the Philippines,” the central bank said.

“The BSP promotes the judicious use of the resources and ensures that external debt requirements are at manageable levels, to support external debt sustainability,” it added.

Recto joins MB

Meanwhile, Finance Secretary Ralph Recto was sworn in on Monday as the government sector representative to the Monetary Board (MB), the BSP's highest policy-making body.

The oath-taking ceremony was administered by BSP Governor and MB Chair Eli Remolona Jr. at the BSP head office in Manila.

The other MB members Bruce Tolentino, Anita Linda Aquino, Romeo Bernardo, Rosalia De Leon and Recto’s predecessor, Benjamin Diokno.

Before his appointment to the DOF on Jan. 15, Recto was a senator for three terms (2001 to 2007 and 2010 to 2022) and held key positions that included Senate President Pro Tempore and Minority Leader.

OFFICIAL. Finance Secretary Ralph Recto (right) takes his oath as the Cabinet representative to the Monetary Board of the Bangko Sentral ng Pilipinas at the BSP office on Monday (Jan. 22, 2024). The oath-taking ceremony was administered by BSP Governor and MB Chair Eli Remolona Jr. (Photo courtesy of BSP)

From 1992 to 2001, he was the representative of the 4th District of Batangas. In 2008, he served as Socioeconomic Planning Secretary of the National Economic and Development Authority.

Recto authored and sponsored numerous tax measures and economic reforms such as the Healthcare Act; Rice Tariffication Act; Ease of Doing Business and Efficient Government Service Delivery Act of 2018; General Tax Amnesty; Rationalization of Excise Tax on Automobiles; and Social Reform and Poverty Alleviation Act.

He also co-authored the Bayanihan to Recover as One Act and the Bayanihan to Heal as One Act to help the country recover faster from the coronavirus disease 2019 pandemic. (PNA)