Coronavirus loans push up government debt to P9.16-T in July
The uptick in borrowings was expected as the government eyed to replace revenues lost from shuttered businesses and stay-at-home consumers during lockdowns.
STAR/ File
Coronavirus loans push up government debt to P9.16-T in July
Ian Nicolas Cigaral (Philstar.com) - September 2, 2020 - 7:15pm

MANILA, Philippines — Money borrowed to fund the Philippines' costly coronavirus programs continued to bloat the country's debt load past the P9-trillion mark in July, the Bureau of the Treasury reported on Wednesday.

Despite the economy reopening last June, the government continued to turn to debt to meet the country's pandemic needs, pushing up the state's total liabilities 1.2% month-on-month to P9.16 trillion in July, a new record-high.

Since December last year, debts have accumulated by 18.5%. By sources, 31.7% of the country's debt pile were borrowed offshore while the bulk of 68.1% came from local creditors.

As early as March, the Duterte administration embarked on a massive fund-raising activity to raise funding for public programs meant to counter the coronavirus disease-2019 (COVID-19) impact.

The uptick in borrowings was expected as the government eyed to replace revenues lost from shuttered businesses and stay-at-home consumers during lockdowns. As a result, the uptrend in debt is expected to persist to P10.16 trillion by yearend and to P11.98 trillion by next year.

Local, foreign debts up

Breaking down the end-July figures, domestic debt stood at P6.26 trillion, up 1.1% from the previous end of previous month, mainly due to P1.84 trillion in government securities purchased over the past seven months alone.

Of the total bond offerings, P1.23 trillion was raised through weekly auction of Treasury bills and bonds, while P310.77 billion was generated from the recent sale of retail Treasury bonds to individual investors in a bid to raise funding for pandemic response.

This year's domestic debt stock likewise included the P300 billion worth of securities bought by the Bangko Sentral ng Pilipinas last March, and renewed last June, to beef up the state's war chest against the outbreak.

Meanwhile, foreign loans pushed up total external obligations 1.5% month-on-month to P2.91 trillion, figures showed. Of the total amount, P481.15 billion was incurred for the past 7 months alone.

Broken down, P280.04 billion in program loans and P15.05 billion in more specific project loans were availed from January to July, contributing to the rise in foreign debt stock. The amounts included P63.73 billion secured from multilateral lenders like the World Bank and Asian Development Bank to help fight the virus.

On top of loans, proceeds from last April's global bonds sale added to the tally. In total,  offshore bond issuances reached P186.06 billion as of July, data showed.

NOVEL CORONAVIRUS PHILIPPINE DEBT
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