Foreign debt bumps up total borrowings to P683.3B

As the Duterte administration availed of more loans from foreign lenders and tapped more offshore debt markets to finance its massive infrastructure program, the government’s borrowings as of September rose by almost a tenth to P683.3 billion.

The latest Bureau of the Treasury data showed the national government’s combined gross external and domestic borrowings during the nine-month period increased 9.6 percent from P623.7 billion in the same period last year.

Gross external borrowings from January to September jumped to P284.3 billion from P160.1 billion a year ago.

During the period, the government availed of P25.8 billion in project loans on top of P69.8 billion in program loans from development partners and multilateral lenders.

The government also issued P12 billion in yuan-denominated panda bonds, P74 billion in samurai bonds and P102.7 billion in US dollar-denominated global bonds.

In March, 1.46-billion renminbi in three-year panda bonds were sold by the Philippine government for the first time in China at a yield of 5 percent.

In August, the Philippines sold 154.2-billion yen in samurai bonds across three tenors, ending the country’s eight-year absence in the Japanese debt market.

The Treasury is eyeing to issue another tranche of global bonds before year-end after selling a total of $2 billion in 10-year dollar-denominated IOUs at a coupon rate of 3 percent in January.

Meanwhile, gross domestic borrowings at end-September declined to P399 billion from P463.6 billion last year, even as the year-to-date financing sourced locally still surpassed foreign debt.

Between January and September, the Treasury sold a net of P124.8 billion in T-bills, P152.4 billion in T-bonds, and P121.8 billion in retail treasury bonds (RTBs).

Last month, the Cabinet-level Development Budget Coordination Committee (DBCC) kept the 2019 borrowing mix at 75-percent domestic, 25-percent external.