Gov’t borrowings up 31% in 11 months of 2017

The government’s gross borrowings grew by a almost a third to P664.3 billion as of November as it contracted more loans from foreign and local sources.

The latest Bureau of the Treasury data showed that total borrowings from January to November rose 31.2 percent from P506.2 billion in the same 11-month period last year.

As of end-November, gross domestic borrowings from the sale of treasury bills and bonds increased to P163.9 billion from P143.6 billion a year ago.

Also, external borrowings in the first 11 months jumped to P500.3 billion from a year ago’s P362.5 billion.

For 2018, the national government’s borrowings had been programmed to reach P888.1 billion.

Economic managers earlier raised the share of foreign borrowings in this year’s financing program on the back of the government’s upcoming foray in the Chinese and Japanese debt markets.

The Cabinet-level Development Budget Coordination Committee last Dec. 22 raised to 26 percent the share of external borrowings in 2018 from 20 percent previously, while it kept the 80-20 ratio in favor of domestic sources from 2019 to 2022.

According to Finance Secretary Carlos Dominguez III, the share of foreign borrowings was increased due to the upcoming global bond sale early this year as well as the planned “panda” and “samurai” bond issuances in China and Japan, respectively.

Dominguez had noted that 2018 would be a good time to tap global debt markets before the US Federal Reserve again hikes interest rates.

The Treasury plans to raise $1 billion in new money at the dollar bond issuance, more than the usual $500 million in recent years, to augment financing of the government’s higher infrastructure spending requirements under the ambitious “Build, Build, Build” program.

The Department of Finance is also planning to sell $200 million worth of three- to five-year panda bonds, or yuan-denominated debt paper issued in China by foreign governments or companies, this first quarter of next year. —BEN O. DE VERA