Monetary Board OKs $2.73B in foreign loans by government in Q2

Philippine monetary authorities have approved $2.73 billion worth of foreign loans by the government for the second quarter of 2023, the Bangko Sentral ng Pilipinas (BSP) said Friday.

In a statement, the BSP said the approved government foreign borrowing level by its Monetary Board in the April-June period was lower by 23% than the $3.54 billion approved in the same period in 2022.

"These are all borrowings by the Republic of the Philippines, consisting of three project loans from the Japan International Cooperation Agency," the central bank said.

"These borrowings will fund various railway projects of the national government," it added.

Citing Section 20, Article VII of the 1987 Constitution, the BSP said its prior approval, through the Monetary Board, is required for all foreign loans to be contracted for or guaranteed by the government. 

"Similarly, Letter of Instructions No. 158 dated 21 January 1974 also requires all foreign borrowing proposals by the national government, government agencies, and government financial institutions to be submitted for approval-in-principle by the Monetary Board before commencement of actual negotiations," the central bank said.

The BSP said it promotes the judicious use of resources and ensures that external debt requirements are at manageable levels to support external debt sustainability. — VBL, GMA Integrated News