Connect with us

Hi, what are you looking for?

Economy

Gov’t eyes P1 trillion in foreign loans

The Philippines is eyeing foreign loans to fund its coronavirus disease 2019 (COVID-19) immunization program this year. — PHILIPPINE STAR/MICHAEL VARCAS

THE Philippines is planning to borrow $23.71 billion (P1.14 trillion) from foreign lenders this year to plug its ballooning deficit amid the pandemic, a Finance official said over the weekend.

“We are planning to source a total of $7.67 billion (P369 billion) in loans and grants from multilateral institutions, $10.54 billion (P507 billion) from our bilateral partners; and raise $5.5 billion (P264 billion) from the commercial markets this year,” Finance Undersecretary Mark Dennis Y.C. Joven said in a statement over the weekend.

Around 66% or $15.65 billion of the loans will be in the form of project financing, while 34% or $8.06 billion will support the national budget.

The Asian Development Bank (ADB) has set a $3.568-billion (P172-billion) lending program for the Philippines this year. Half of the amount or $1.75 billion (P84 billion) will go to the first phase of the South Commuter Railway Project, and the rest for other infrastructure projects.

The World Bank is also looking to grant $1.588 billion (P76 billion) in loans to the Philippines this year, after lending $1.87 billion (P90 billion) in 2020.

The government has tapped the World Bank for a $500-million loan to fund its mass vaccination drive against the coronavirus disease 2019 (COVID-19), while the ADB committed to lend at least $350 million.

This year, the government is planning to raise P3 trillion from domestic and external lenders to help fund the budget deficit that is seen to hit 8.9% of gross domestic product.

“The government has consistently availed debt for budget support, recognizing that program loans and global bonds provide more flexibility in terms of utilization,” Mr. Joven, who heads the Department of Finance’s International Finance Group (IFG), said.

In 2020, the government obtained $17.06 billion (P820 billion) in loans from external sources, of which $7.73 billion (P372 billion) came from multilateral lenders.

“Because of a higher emergency funding requirement in light of COVID-19, the amount of external financing contracted in 2020 increased by 75.43% year on year. This also represents an overall 33% expansion of the external borrowing program from 2016 to 2020,” Mr. Joven was quoted as saying in the statement.

The $17.06-billion foreign loans last year consisted of 85% or $14.52 billion in budget support and the rest worth $2.54 billion were in project loans meant to cover the funding needs of multi-year projects rolled out in 2020.

Around 90% or $15.44 billion (P742 billion) was used for the pandemic response, while $1.62 billion (P78 billion) went to infrastructure projects. — Beatrice M. Laforga

Click to comment

Leave a Reply

Your email address will not be published. Required fields are marked *

Get the daily email that makes reading the news actually enjoyable. Stay informed and entertained, for free.
Your information is secure and your privacy is protected. By opting in you agree to receive emails from us. Remember that you can opt-out any time, we hate spam too!

Latest

Economy

WASHINGTON D.C. — The United States is seeking to form a coalition of countries to drive negotiations on a global plastic pollution treaty, weeks...

Economy

By Diego Gabriel C. Robles  THE WORLD BANK (WB) upgraded its growth forecast for the Philippines for this year and 2023, citing an “accommodative”...

Economy

THE PHILIPPINE auto industry’s sales recovery will likely be derailed if a measure reimposing excise taxes on pickup trucks is signed into law, according...

Economy

THE BANGKO SENTRAL ng Pilipinas (BSP) may deliver a second off-cycle rate hike in early November when the US Federal Reserve is expected to...

Economy

THE ASIAN Development Bank (ADB) is planning to allocate at least $14 billion for a program aimed at easing a food crisis in the...

Investing

With the reversal of the 1.25% rise in National Insurance Contributions happening on the 6th of November, employers across the nation have an opportunity...

You May Also Like

Investing

Having a good Instagram marketing agency to back up your Instagram account is an absolute must going into the new year. With competition stronger...

Investing

The minute that any question pops into your head, you can simply ask Google. No longer do we have to pour over books and...

Investing

Insomnia is the most common sleep disorder in the global population. Therefore, it is a problem that many people suffer or have suffered throughout...

Economy

Ivermectin, an existing drug against parasites including head lice, has had a checkered history when it comes to treating COVID-19. The bulk of studies...

Disclaimer: SmartRetirementReport.com, its managers, its employees, and assigns (collectively "The Company") do not make any guarantee or warranty about what is advertised above. Information provided by this website is for research purposes only and should not be considered as personalized financial advice. The Company is not affiliated with, nor does it receive compensation from, any specific security. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation. Any investments recommended here should be taken into consideration only after consulting with your investment advisor and after reviewing the prospectus or financial statements of the company.

Copyright © 2021 SmartRetirementReport. All Rights Reserved.