PH keeps borrowing limit of P135b in Q3

The Bureau of Treasury said over the weekend it will keep a domestic borrowing ceiling of P135 billion in the third quarter of the year.

The agency said in a notice posted in its website it was keeping the borrowing ceiling through the auction of treasury bills and bonds in July to September 2016 to finance this year’s budget deficit target equivelent to 2.5 percent of the gross domestic product.

The government plans to sell P20 billion worth of 91-, 182-, and 364-day debt paper on July 20, Aug. 10 and Sept. 21. It will also sell P25 billion worth of treasury bonds through auctions on July 28, Aug. 8 and Sept. 18.

The auction of the various debt paper with short and long tenors were the same as programmed in the first two quarters of the year.

The government is keeping a borrowing mix of 14 percent from foreign and 86 percent from domestic creditor in 2016.

The inter-agency Development Budget Coordination Committee earlier told reporters the government aimed to reduce its dependence on costly foreign debt by maintaining the current domestic component of its borrowing plan.

Finance Secretary Carlos Dominguez III said that the country has enough liquidity to support the projected higher deficit for this year.

“Our data show we have enough liquidity in the domestic market to support public borrowing,” Dominguez said. “A more aggressive spending plan will, in fact, help relieve our domestic banking system of excess liquidity problems.”

Meanwhile, the national government’s debt as of end-May this year hit P5.885 trillion, up 2.31 percent from P5.752 trillion year-on-year.

On a monthly basis, the national government debt was almost unchanged, increasing just 0.3 percent or about P1.93 billion from P5.883 trillion at the end of April.

Domestic debt as of end-May dropped 0.56 percent to P3.79 trillion from P3.81 trillion a year ago. The debt, however, was P27.93 billion higher than P3.76 trillion recorded in April.

Foreign debt, which accounts for the remaining national debt, climbed 8 percent to P2.08 trillion in end-May from P1.93 trillion in the same month last year. The figur was P26 billion higher than the end-April 2016 level. 

Meanwhile, national guaranteed debt in May 2016 rose 12.25 percent to P448.20 billion from P399.279 billion a year ago.The figure was P58.84 billion lower than the prior month’s level. 

The government plans to borrow less this year and reduce the debt stock to a record low of 41.8 percent of the economy from 44.8 percent last year. 

The debt stock a decade ago was at a high of 68.5 percent before being trimmed to below 50 percent of the economy since 2013.