Gov’t borrowings cut by half to P141.2B in Q1

Total government borrowings were cut to half in the first quarter of the year due to less issuance of bonds and government securities both in the domestic and international markets. Data from the Bureau of Treasury (BTr) showed that the government borrowed P141.21 billion from domestic and foreign creditors during the first quarter of the year or 50.5 percent lower than the P285.27 billion it borrowed in the same quarter last year. The government overshot its P131.4-billion borrowing program for the first quarter by P9.81 billion as it decided to avail of more of cheaper official development assistance (ODA) loans from multilateral lending agencies led by Asian Development Bank (ADB), World Bank (WB), and Japan Bank for International Cooperation (JBIC). Statistics showed that the government was able to slash domestic borrowings by 70.7 percent to P49.88 billion from January to March this year compared to P170.25 billion last year when it swapped P165 billion worth of eligible bonds with P180 billion worth of new three-, five-, and seven-year benchmark bonds. Domestic borrowings in the first quarter was P481 million lower than the programmed P50.36 billion. Likewise, the government was able to reduce its foreign borrowings by 20.6 percent to P91.33 billion from P115.02 billion despite completing its $1 billion commercial borrowing program for the year last January. Foreign commercial borrowings in the first quarter reached P48.76 billion or 56 percent lower than last year’s P110.53 billion. Instead, the government decided to source more loans that carry lower interest and longer repayment period from multilateral lending agencies. It obtained P38.77 billion worth of program loans and P3.78 billion worth of project loans during the first quarter. Due to the decision to source additional cheaper ODA loans, the government breached its P81.05 billion foreign borrowing program for the first quarter by P10.49 billion. The treasury data likewise showed that payments for maturing foreign and domestic obligations fell 50.76 percent to P86.43 billion from January to March compared to P175.54 billion in the same period last year. Amortization for both foreign and domestic obligations was P7.87 billion more than the P78.56 billion program for the quarter. Payment of maturing domestic obligations plunged 55.2 percent to P70.48 billion from P157.41 billion while payment of maturing foreign debt declined 12 percent to P15.94 billion from P18.13 billion. The Philippine government intends to borrow P380.95 billion this year to pare down its debt and at the same time plug the country’s budget deficit. Of the total amount, about 67 percent or P260.1 billion would come from domestic sources while 33 percent or P130.7 billion would be sourced from foreign creditors. Of the total amount to be borrower, about P298.43 billion would be used to pare down maturing domestic and foreign obligations while P82.52 billion would be used to finance the budget shortfall. The government hopes to trim the budget deficit to P63 billion or 0.9 percent of gross domestic product (GDP) this year from an eight-year low of P64.8 billion or one percent of GDP last year.- GMANews.TV