End-July borrowings climbed 22% to P 2.27T

A surge in domestic fund-raising offset the decline in foreign financing during the first seven months, jacking up the national government’s gross borrowings by more than a fifth to P2.27 trillion.

The latest Bureau of the Treasury data showed that the gross amount borrowed from January to July jumped 22 percent from P1.86 trillion a year ago, in part to bankroll pandemic response programs.

End-July gross domestic borrowings climbed to P1.83 trillion from P1.38 trillion during the first seven months of last year.

As of July, locally sourced financing included P779.86 billion in fixed-rate treasury bonds, P463.32 billion in retail treasury bonds (RTBs), a net of P45.09 billion in short-dated treasury bills, plus the P540-billion zero-interest, short-term borrowing from the Bangko Sentral ng Pilipinas.

Highest issuance

In July alone, the Treasury raised P208.86 billion in bonds—the highest monthly issuance so far this year—from the weekly auctions as investors snapped up longer tenors.

Meanwhile, gross external borrowings during the seven-month period declined to P441.74 billion from a year ago’s P481.15 billion.

Among the foreign funds raised commercially as of end-July were P146.17 billion in US dollar-denominated global bonds, P121.97 billion in euro-denominated bonds, as well as P24.19 billion in yen-denominated samurai bonds.

In July, the Treasury settled $3 billion in global bonds—$2.25 billion in 25-year, and $750 million in 10.5-year—which fetched tighter yields than their initial price guidance when offered last June.

Multilateral lenders and bilateral development partners also extended to the Philippines P95.08 billion in program loans plus P54.33 billion worth of project loans.

The government will borrow P3.07 trillion in 2021, which will hike its outstanding debt to a record-high P11.73 trillion by yearend, or 59.1 percent of gross domestic product. INQ