Napocor debts balloon to $6.6-B

The debts of the National Power Corp. (Napocor) have ballooned to $6.6 billion as of end-2002 from $6.1 billion in 2001 due to a series of borrowings, according to a Napocor official.

Napocor was able to raise some $1.5 billion through a bond offering in 2002, but it also had to pay some of its maturing loans, including the $147 million from ING Barings.

The bulk of Napocor’s debts consists of foreign loans, bonds payable, borrowing from the Philippine government and its agencies.

The state power firm’s debt is expected to rise further this year.

For the first half, Napocor through the Power Sector Assets and Liabilities Management Corp. (PSALM), intends to borrow $500 million through a bond floatation in the international maket.

The huge debts of Napocor can only be reduced through privatization wherein the government will no longer be burdened with providing financing requirement for the power generation firm.

President Arroyo has stated that privatizing Napocor will put an end to the financial problem of the National Government in subsidizing the debt-ridden power company. "We need to put a stop to all this. We need to put a stop to the continous hemorrhage of government funds due to financial losses of Napocor," she added.

Mrs. Arroyo noted that over the past five years, Napocor has incurred losses of P73 billion.