Finance Secretary Carlos G. Dominguez III yesterday reiterated that the Duterte administration’s planned infrastructure buildup would be funded mainly by revenue gains from the comprehensive tax reform plan and local borrowings so that the government would not fall into a “debt trap.”
“The government will take advantage of the excess liquidity in the domestic market by borrowing 80 percent from banks and other financial institutions here, while tapping only 20 percent of its loans from overseas lenders,” Dominguez said, referring to the borrowing program for the next six years to finance a budget deficit of 3 percent yearly arising from increased infrastructure spending.
“We will invest wisely and gain from the investments we have made to pay for the country’s debts,” Dominguez said, reacting to an opinion piece of Corr Analytics founder Anders Corr published in Forbes Magazine, which claimed that Philippine debt, including interest, could jump to $452 billion from $167 billion at present.