PH’s foreign borrowings for COVID-19 hit $8.13 billion

MANILA, Philippines — Foreign borrowings and grants secured by the Philippines to fight the health and socioeconomic crises caused by COVID-19 further inched up to nearly P400 billion as of August, the Department of Finance (DOF) said.

Its latest report showed that as of Aug. 5, the DOF raised $7.63 billion in program loans from multilateral lenders and bilateral partners as well as commercial borrowings for budgetary support, of which $6.26 billion were already injected into the budget.

Also, the Philippines got $496.36 billion in project loans and grants for specific COVID-19 response projects.

As such, the foreign financing raised so far to better respond to the COVID-19 pandemic totaled $8.13 billion or about P398.6 billion, up from $7.76 billion a month ago.

The budgetary-support financing for COVID-19 response from the Manila-based Asian Development Bank (ADB) were the following: $1.5-billion COVID-19 active response and expenditure support (Cares) program; $200-million social protection support project (second additional financing); $400-million support to capital market generated infrastructure financing (subprogram 1); and $500-million expanded social assistance program.

From the Washington-based World Bank, the Philippines borrowed: the $500-million third disaster risk management development policy loan; $500-million emergency COVID-19 response development policy loan; and $200-million social welfare development and reform project 2 (additional financing).

The DOF also borrowed $750 million from the Beijing-based Asian Infrastructure Investment Bank (AIIB), which co-financed the ADB’s Cares program.

Also part of budgetary-support borrowings were the $2.35 billion raised from the issuance last May of US dollar-denominated global bonds at record-low coupons across two tenors.

Among bilateral aid agencies, the Agence Française de Développement (AFD) extended $165.42 million for the expanding private participation in infrastructure program (subprogram 2), on top of $110.28 million for the inclusive finance development program (subprogram 1), both co-financed with the ADB.

The Japan International Cooperation Agency (Jica) also extended the $458.95-million COVID-19 crisis response emergency support loan.

On top of these loans supporting the budget, the Philippines likewise secured from the World Bank two project loans: a $100-million loan for the COVID-19 emergency response project, as well as $370 million for the support to parcelization of lands for individual titling (Split) project.

As for grants, the following three grant assistance totaling $26.36 million were given to the Philippines: $3-million COVID-19 emergency response project and $5-million rapid emergency supplies provision from the ADB; and $18.36 million from the Japanese government to provide medical equipment to the Department of Health (DOH).

/MUF