End-Oct borrowings hit P 2.75T, eclipsing 2020 level

The national government’s P2.75 trillion in borrowings from January to October already exceeded last year’s total, but President Duterte’s chief economic manager has assured that current debt levels remained manageable and affordable.

End-October gross financing surpassed the P2.74 trillion borrowed from local and foreign sources for the entire 2020, latest Bureau of the Treasury data showed.

The bigger chunk still came from domestic borrowings, which as of October amounted to P2.23 trillion, as P80.8 billion worth of the first-ever retail dollar bonds were added to the debt pile.

The government also borrowed a cumulative P1.19 trillion in fixed-rate treasury bonds, P463.3 billion in retail treasury bonds and the P540-billion zero-interest, short-term debt extended by the Bangko Sentral ng Pilipinas to support economic recovery from last year’s pandemic-induced slump. The increase in debt paper with longer tenors was offset by the maturity of P43.9 billion in short-dated T-bills at end-October.

Speaking before foreign business chambers last week, Finance Secretary Carlos Dominguez III noted that in recent years, “more than two-thirds of our borrowings are being sourced from our very liquid domestic market.”

Of the P3.07-trillion borrowings program for 2021, over four-fifths or P2.49 trillion will be raised from the sale of treasury bills and bonds.

Meanwhile, end-October external borrowings totaled P518.7 billion, down from P574.4 billion in the same period last year.

Foreign financing included P139.9 billion in program loans and P86.4 billion in project loans from multilateral banks and bilateral development partners. The government also issued P146.2 billion in US dollar-denominated global bonds, P121.9 billion worth of euro bonds, and P24.2 billion in yen-denominated samurai bonds.

Dominguez said that as of August, the share of foreign debt to gross domestic product declined to 26.5 percent from 27.2 percent a year ago. INQ