Gov’t gross borrowing up by 4.51% in May

MANILA, Philippines – The government’s gross borrowings increased by 4.51% in May, led by borrowing from local sources during the period.

According to the Bureau of the Treasury, the total amount borrowed by the government from local and foreign sources in May was P22.15 billion ($484.9 million), higher than the P21.19 billion ($463.9 million) recorded in the same period last year.

Government debt as of end-June stood at P5.82 trillion ($127.4 billion), up from the P5.74 trillion ($125.6 billion) registered in the same period last year.

May borrowing

Local borrowings in May 2015 increased to P21.39 billion ($468.3 million) from the P19.91 billion ($435.9 milion) borrowed in May last year.

The government issued P22.39 billion ($490.2 million) worth of fixed-rate treasury bonds, which was partly offset by the redemption of P1 billion ($21.89 million) in the form of treasury bills.

Treasury bills are short-term government debt obligation, with tenors of 3 and 6 months, and one year, while treasury bonds are those which will mature more than 1 year after the date of issuance.

Payments for local debt during the May amounted to P41.35 billion ($905.3 million), resulting in a net redemption of P19.97 billion ($437.2 million).

On the other hand, international borrowings fell to P760 million ($16.64 million) from the P1.28 billion registered in the same period in 2014.

The government borrowed from foreign sources through project and program loans, with P350 million ($7.66 million) and P410 million ($8.97 million), respectively.

Payments for foreign debt amounted to P5.28 billion ($127.4 million), which resulted in a net external redemption of P4.52 billion ($98.96 million).

Year to date borrowing

The year-to-date borrowings of the government amounted to P150.77 billion ($3.30 billion), 2.16 % up from the P147.59 billion ($3.23 billion) borrowed in January to May last year.

External loans went up to P80.44 billion (P1.76 billion) from the P56.57 billion ($1.23 billion) recorded a year ago while funds from local lenders amounted to P70.34 billion ($1.54 billion), lower than the P91.02 billion ($1.99 billion) borrowed in the same period in 2014.

The Bureau of the Treasury earlier reported that the national government’s outstanding debt as of end-June jumped by 2.9 % from the previous year, due to the increase in both local and foreign loans.

Domestic debt accounted for bulk of the debt portfolio with a share of 66%, while foreign obligations took up the remaining 34%.

2016 borrowing plans

Government’s gross borrowings for 2016 is projected at P674.8 billion ($14.77 billion), lower than the P710.82 billion ($15.56 billion) programmed for this year.

The government will borrow more from local financing, accounting for 85 % of next year’s borrowing plan.

Gross domestic borrowings is set to amount to P570.23 billion ($1.23 billion), higher than the P532.68 billion ($1.16 billion) programmed for 2015.

Gross foreign borrowings on the other hand is set at P104.58 billion ($2.28 billion), lower than the P178.14 billion ($3.9 billion) for 2015. – Rappler.com

$1 = 45.67