Gov’t to exercise fiscal prudence in infrastructure push

Finance Secretary Carlos Dominguez III said the government will exercise fiscal prudence in implementing its infrastructure buildup.

Dominguez said the government will only resort to financing its ambitious infrastructure push through borrowings – and mostly from local sources – if the “economy can grow to finance its debts.”

“This administration is responsible enough to put money where it is required so there can be more businesses in the areas where the infrastructure will be built,” Dominguez said.

Dominguez said the Duterte administration is bent on having its Comprehensive Tax Reform Program (CTRP) approved in the Congress so that it could help raise enough revenues to bankroll the government’s ambitious plan to modernize the country's infrastructure backbone so the Philippines could catch up with its more vibrant Southeast Asian neighbors.

The first package of the CTRP, Dominguez said, would serve as the “cornerstone” of the funding for the government’s "build, build, build" program. He likewise pointed out that the government will take advantage of the excess liquidity in the domestic market by borrowing 80 percent from banks and other financial institutions here, while tapping only 20 percent of its loans from overseas

lenders.

“We will invest wisely and gain from the investments we have made to pay for the country’s debts,” Dominguez said in response to concerns that the government might fall into a “debt trap” in implementing its infra program.

The Duterte administration is planning to spend R8.4 trillion over the next five years to close the country’s infrastructure gap that has for decades blunted its global competitiveness as an investment destination.