Gov’t borrowings rise to P581 B

The national government borrowed P581.28 billion from local and foreign lenders in the first eight months, according to the Bureau of the Treasury (BTr).

Latest data from the Treasury showed gross borrowings from January to August rose 60.27 percent to P581.28 billion from P362.67 billion in the same period last year.

For August alone, government borrowings more than doubled to P61.31 billion from P28.65 billion in the same month a year ago.

The government borrows from local and foreign creditors to pay maturing debt and finance its budget deficit, which is targeted at three percent of the country’s projected gross domestic product.

According to the Treasury, P426.64 billion of the total borrowings during the eight-month period came from domestic sources, while the remaining P154.63 billion was sourced from foreign lenders.

Domestic debt was 88.98 percent higher than the P225.763 recorded in the same period last year.

Of the amount, P199.82 billion came from the issuance of fixed rate Treasurybonds while P44.97 billion came from the sale of Treasury-bills.

Another P181.85 billion was raised from the sale of retail Treasury bonds (RTB) to the general investing public last April.

The money generated from the RTBs, which were sold at a coupon rate of 4.25 percent, will be used to support the administration’s initiatives, particularly its massive infrastructure spending program.

Meanwhile, foreign borrowings rose 12.94 percent to P15.63 billion from P136.91 billion as of end-August last year.

A large portion of this, amounting to P99.57 billion was borrowed through the sale of global bonds last February.

Under this fund-raising activity, the government generated $500 million from the issuance of fresh 25-year global bonds at a rate of 3.7 percent.

Another source of foreign credit is the multilateral agencies, such as the World Bank, Asian Development Bank and the Japan International Cooperation Agency. As of end-August, these institutions extended P30.68 billion in program loans and P24.39 billion in project loans to the Philippine government.