To finance response to the COVID-19 pandemic, the Philippine government so far borrowed from foreign lenders and secured grants worth nearly $5 billion, with much of the money already injected into the national budget, the Department of Finance (DOF) said.
In a report, the DOF said $4.05 billion of the $4.858 billion of foreign loans have been disbursed to the government for COVID-19 response.
The $4.75-billion budgetary support financing raised by the DOF for COVID-19 so far included two Asian Development Bank (ADB) loans, two World Bank loans, and the sale of US dollar-denominated bonds offshore.
In April, the Philippines and the Manila-based ADB signed two loan agreements: $1.5-billion COVID-19 Active Response and Expenditure Support Program and $200-million Social Protection Support Project-Second Additional Financing.
From the Washington-based World Bank, the country borrowed $500 million through the Third Disaster Risk Management Development Policy Loan last April.
Of the Social Welfare Development and Reform Project 2-Additional Financing secured from the World Bank last year, “total loan amount is $300 million, of which $200 million is availed for budgetary support purposes in light of COVID-19 response,” the DOF said.
The Philippines’ $2.35-billion global bonds, which fetched record-low coupons for both two tenors when sold in April, will also be used for COVID-19 funding requirements.
Another loan, which was not infused into the budget but earmarked for a specific project—the COVID-19 Emergency Response Project—was signed with the World Bank last April.
On top of these borrowings, the DOF noted that the Philippines also received two grants both from the ADB: $3-million COVID-19 Emergency Response Project, and $5-million Rapid Emergency Supplies Provision.
The documents containing these loan agreements and grants were made available on the DOF’s website.