BSP Approved $8.29-B Gov’t Foreign Loans In H1

The Bangko Sentral ng Pilipinas (BSP) approved $8.29-billion worth of public sector foreign borrowings in the first six months this year, slightly lower by 0.6 percent compared with $8.34 billion in the same period last year.

Photo Insert: The BSP said that the Monetary Board, its policy-making arm, gave the go-signal for the government to borrow $2.73 billion in the second quarter, which was lower by 23% than the $3.54-billion borrowings in the same period in 2022.

It said recently that the Monetary Board, its policy-making arm, gave the go-signal for the government to borrow $2.73 billion in the second quarter, which was lower by 23% than the $3.54-billion borrowings in the same period in 2022.

Back in April, it reported a $5.56-billion public sector foreign borrowing in the first quarter, up 16% from the $4.8 billion loans tapped in the same period last year.

The public sector borrowings consisted of both project loans and program loans, which included sovereign bond sales for National Government (NG) general financing requirements such as the COVID-19 pandemic response and infrastructure-related developments.

“These are all borrowings by the Republic of the Philippines consisting of three project loans from the Japan International Cooperation Agency. These borrowings will fund various railway projects of the NG,” said the BSP.

In 2022, the BSP approved a total of $ 10.3 billion worth of public sector foreign borrowings. This amount was lower by 21.43% than the $13.14-billion loans tapped in 2021.

To ensure the foreign debt level remains manageable, the BSP is mandated to review and approve all public sector or government foreign borrowings under Section 20, Article VII of the 1987 Philippine Constitution.

The BSP reiterated that it “promotes the judicious use of the resources and ensures that external debt requirements are at manageable levels, to support external debt sustainability.”

As of end-March this year, the country’s outstanding external debt stood at $118.812 billion, up by 8.25% compared to the same period last year of $109.753 billion.

The current debt stock is equivalent to 29% of gross domestic product (GDP), higher than 27.5% from end-December 2022 and end-March last year.

Public sector external debt amounted to $75.2 billion during the period, up from end-2022’s $67.4 billion. About $68.1 billion or 90.5% were NG borrowings, while $7.1 billion were loans by government-owned and controlled corporations, government financial institutions, and the BSP.

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