Philippines borrows more
The Philippine government plans to increase its borrowing to plug its anticipated higher than programmed fiscal deficit for this year.
In a text message, Finance Undersecretary Rosalia de Leon said the government may borrow another P5 billion to P7 billion, which would likely be sourced from the domestic market, according to the Manila Times.
“The increase in deficit is just about P7 billion. The new numbers and program are still to be discussed with the new economic team,” de Leon said.
The interagency Development and Budget Coordinating Committee on Tuesday raised the government’s budget deficit ceiling to P300 billion from the original cap of P293 billion.
This came alongside the upward revision in the country’s economic growth target to a range of 5 percent to 6 percent, from the earlier goal of 2.6 to 3.6 percent.
National Treasurer Roberto Tan, however, said the additional borrowing for this year may be capped at P5 billion given that the revenue shortfall may not go beyond P297 billion.
Finance Secretary Margarito Teves said in a text message that “the national treasurer, undersecretary of the international finance group and the deputy governor of the Bangko Sentral [ng Pilipinas] will recommend and subsequently implement the appropriate combination and approximate timing” of the new borrowing.
Before the planned increase, this year’s borrowing program was pegged at P708.153 billion. For next year, the government wants to raise its borrowing by 8 percent to P764 billion despite the lower budget deficit cap of P285 billion.
Of the P764 billion in fresh debt, P558.7 billion would be sourced from domestic sources. Another P205.86 billion would come from foreign sources.
Tan had said that the lower deficit ceiling for next year doesn’t entail trimming borrowings as well as the additional debt would be used to refinance maturing liabilities.
For next year, the government’s debt amortization would hit P462.128 billion, or 16 percent higher than this year’s P399.89 billion.
Tan had said that foreign currency-denominated borrowings would be mostly in US dollars. But if the euro and yen would be attractive, then the government would also pursue loans in those currencies, he added.