GOVERNMENT borrowing grew slightly in February driven by the issue of bonds and bills, the Bureau of the Treasury said.
The Philippines borrowed P56.74 billion in February, up 4.15% from a year earlier.
This brings year-to-date borrowing to P273.85 billion, from P99.14 billion in the first two months of 2018.
State borrowing in February was driven by net domestic lending amounting to P59.44 billion, a reversal from the P1.47 billion in net redemptions of debt owed to domestic lenders a year earlier.
The government borrowed P29.44 billion via Treasury bills offered weekly. Some P30 billion was also raised in February via a Treasury bond auction.
Government borrowing in that month was offset by redemptions of debt from foreign creditors amounting to P3.59 billion.
Deducting project loans captured in February at P894.82 million, net redemptions of external debt amounted to P2.7 billion.
This year, economic managers set a 75-25% borrowing mix in favor of domestic sources to raise P1.189 trillion, with the share of foreign debt declining from 35% in 2018.
Finance Secretary Carlos G. Dominguez III said in a speech Friday that a “significant portion” of the country’s financing is sourced from the domestic debt market “to minimize exposure from external developments.”
“We are also very careful about our debt structure as we do not want to borrow without putting in our own capital as well,” he said.
Meanwhile, according to a separate BTr data, the Philippines made P99.76 billion worth of debt payments in February, compared with P80.49 billion a year earlier.
This brings total payments made by the Philippines so far this year to P177.38 billion.
Principal payments accounted for roughly 75% of total at P74.46 billion in February, up 36.9%.
The national government paid P70.88 billion worth of outstanding domestic liabilities, from zero in 2018. The Philippines also paid P3.59 billion it foreign debt, compared with P54.39 billion a year earlier.
On the other hand, interest payments were at P25.3 billion in February, with P14.81 billion going to domestic creditors and P10.49 billion to external sources.
The budget deficit is projected to widen to as much as 3.2% of gross domestic product in 2019, compared with a programmed 3% share and the actual level of 3.2% in 2018, to accommodate increased government spending particularly on infrastructure. — Karl Angelo N. Vidal