The national government took out fewer foreign loans in the first quarter of the year to meet its financing needs, according to the central bank, whose policy-making Monetary Board screens and approves all borrowings of state instrumentalities.
In a statement, the Bangko Sentral ng Pilipinas said the Monetary Board approved $2.38 billion in foreign borrowings of the government in the first three months of 2020.
This was lower by $1.04 billion—or 30 percent—from the first quarter 2019 approvals of $3.42 billion.
These public sector borrowings consisted of one bond issuance amounting to 1.2 billion euros; four project loans totalling $493 million, and two program loans worth $800 million.
“These foreign borrowings will fund the national government’s general financing requirements; projects to support infrastructure development and transport connectivity; the implementation of Philippine Competition Act, and programs to develop youth employment opportunities and resilience to natural disasters,” the central bank said.
Of the total approved borrowings, 9.23 percent or $219.8 million will fund an infrastructure flagship project under the Duterte administration’s “Build, Build, Build” program, particularly the undertakings of the project management consultancy of the Philippine National Railways’ South Long Haul Project.
Under the Constitution, prior approval of the central bank through its Monetary Board is required for all foreign loans to be contracted or guaranteed by the Republic of the Philippines.
“The BSP promotes the judicious use of the resources and ensures that external debt requirements are at manageable levels, to ensure external debt sustainability,” the central bank said. INQ