Gov’t borrowing rises 3.2% in 2018

Font Size

FACADE of the Bureau of the Treasury headquarters. — PHOTO BY MELISSA LUZ T. LOPEZ

GOVERNMENT borrowing grew 3.2% in 2018 to its highest level in six years, the Bureau of the Treasury said.

In 2018, total government borrowing was P783.23 billion, against the P758.93 billion from a year earlier.

The record for government borrowing remains P866.86 billion set in 2012.

The 2018 borrowing total represented 88.18% of the government’s borrowing plan of P888.23 billion which would have been a new record if fully taken up.

The government borrowed P591.53 billion from domestic sources in 2018, or about 75.5% of the financing portfolio and exceeding the 65% target.

The total raised from domestic creditors declined 19.1% from the 2017 total.

Some P292.77 billion was raised through the issue of Treasury bonds, while another P179.94 billion was raised from Treasury bills.

In June 2018, the government raised P121.77 billion from the issue of three-year retail Treasury bonds.

Meanwhile, funds sourced externally amounted to P191.75 billion, up 595.5% from a year earlier.

In February, the government issued P102.68 billion worth of dollar-denominated 10-year global bonds, followed by a maiden issue of renminbi-denominated three-year “panda” bonds in March, raising P11.976 billion.

The government returned to the yen bond market in August after issuing P74.04 billion worth of “samurai” bonds in three different tenors.

Meanwhile, the government borrowed P74.32 billion in December, 67.7% lower year on year and down 17.8% month on month.

The government plans to borrow P1.189 trillion this year to help finance its spending plan. Of this year’s total, P891.7 billion will be sourced domestically while P297.2 billion is expected from external creditors.

Economic managers have adjusted the borrowing ratio to 75-25 in favor of domestic sources for this year until 2022, from the 65-35 ratio in 2018. — Karl Angelo N. Vidal