PH foreign borrowings, grants vs COVID-19 hit P1.3T

The Philippines’ foreign borrowings plus the grants it received to finance COVID-19 response since the start of the pandemic have reached a combined $25.79 billion or P1.32 trillion, the Department of Finance (DOF) said on Friday.

In a report, the DOF said external financing—loans from multilateral lenders and bilateral development partners as well as offshore commercial borrowings through sovereign bonds—injected into the national budget as part of the COVID-19 war chest amounted to $22.55 billion, or P1.15 trillion, as of Jan. 14.

The latest additions to foreign-sourced budgetary support included six loans, which took effect—signed by the government and its creditors, and then made ready for disbursement—last month and this month, such as the World Bank’s $600-million promoting competitiveness and enhancing resilience to natural disasters development policy loan (subprogram 3) and the $500-million Philippines fourth disaster risk management development policy loan with a catastrophe drawdown option.

The Manila-based Asian Development Bank’s (ADB) $600-million build universal health care program and $400-million local governance reform program (subprogram 2) were also added to the debt pile in December 2021.

Also part of budgetary support financing were Agence Française de Développement’s $285.22-million disaster risk reduction enhancement at the local level program, as well as Export-Import Bank of Korea-Economic Development Cooperation Fund’s $100-million program loan for COVID-19 emergency response program (vaccination program).

On top of program loans, the Philippines secured $3.19 billion (about P163.1 billion) in project loan financing to fund specific projects, including the purchase of vaccines and boosters.

Following the $1.2 billion it borrowed from the World Bank, the ADB, and the China-led Asian Infrastructure Investment Bank (AIIB) in March 2021 to buy vaccines, the Philippines obtained another $800 million from the same three development banks in December to purchase booster and pediatric shots.

The total of $2 billion (about P102.2 billion) in loans for vaccine procurement funded the unprogrammed appropriations set aside in last year’s and this year’s national budgets.