Government borrowings drop 2.44% to P207 billion in Q1

MANILA, Philippines — The national government borrowed P207.92 billion from both domestic and foreign lenders in the first three months, 2.44 percent lower than the previous year’s P213.12 billion, according to the Bureau of the Treasury (BTr).

Borrowings for March alone rose by 23.05 percent to P51.39 billion from last year’s level of P41.763 billion.

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 gross domestic product (GDP).

For the first quarter, the bulk or P146.14 billion of total borrowings came from external creditors, up 16.97 percent from the P124.94 billion in the same period in 2017.

About P102.68 billion of external obligations during the three-month period came in the form of global bonds, while P12.014 billion came as panda bonds or renminbi denominated bonds.

Last January, the government successfully sold $2 billion worth of 10-year global bonds at a coupon rate of 3.3 percent.

About 1.46 billion renminbi ($230 million) in new money was also raised from the sale of three year panda bonds at a coupon rate of five percent.

Other sources of external debt include program loans (P21.44 billion) and project loans (P10 billion) from multilateral agencies such as the World Bank, Asian Development Bank, and Japan International Cooperation Agency.

Meanwhile, domestic borrowings in the first quarter fell by 29.94 percent to P61.78 billion from P88.18 billion last year.

Of the amount, P43.77 was raised from the issuance of Treasury bonds, while P18 billion came from the sale of Treasury bills.

As of end-March, the national government’s outstanding debt stood at P6.879 trillion, 0.85 percent higher than the previous month’s level of P6.821 trillion.

For the whole year, the national government is programmed to borrow P889.51 billion from local and foreign lenders.