Despite euro crisis, PH bonds raise USD 1.5-B

Rappler.com

This is AI generated summarization, which may have errors. For context, always refer to the full article.

Investor confidence in the Philippines makes it easier to access funds for roads, ports, school buildings

MANILA, Philippines – The government successfully raised $1.5 billion from the sale of dollar-denominated 25-year bonds that will finance infrastructure spending.

The global bonds, which have a 5% yield and are maturing in 2037, were oversubscribed. It attracted about $12.5 billion orders, a finance official told Reuters.

Talking to ANC on Thursday, Jan. 5, 2012, Finance Secretary Cesar Purisima said, “This speaks highly of the confidence of the market in the Philippines.”

Despite the uncertainties due to the euro zone crisis, Purisima said investors still bought the long-term debt paper.

“They like the fiscal consolidation, growth, transformation and good government agenda of the Aquino government. I think they are bullish in the Philippines,” he said.

This 25-year paper raised bulk of the government’s $2.25 billion foreign debt requirement for 2012.

Purisima said foreign denominated debts will account for 25% of the government’s borrowing program for 2012. The rest will be in local currency.

“This allows us to diversify holders of instruments and lengthen maturities, continue to lower our interest cost and reduce the bunching up of maturities,” he said.

The funds will pay for the recently announced P142 billion ($3.2 billion) budget for infrastructure projects, including roads, ports, school buildings. Most of these were planned but were not implemented in 2011 as the Aquino government pursued basic governance checks.

These crucial infrastructure projects, which account for 78% of the country’s public works spending budget this 2012, are expected to boost economic growth. – Rappler.com

Add a comment

Sort by

There are no comments yet. Add your comment to start the conversation.

Summarize this article with AI

How does this make you feel?

Loading
Download the Rappler App!