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Government loans surpass the P3 trillion mark in November
Ian Nicolas Cigaral (Philstar.com) – December 24, 2020 – 12:53 pm
MANILA, Philippines – The government debt burden continued its upward trend from January to November, and gross loans soared past the P3 trillion mark as the country’s pandemic needs grew.
The state’s gross liabilities amounted to P3.05 trillion in 11 months, increasing 210.4% year-on-year, the latest data from the Treasury Office showed.
Though dramatically high, the last tally of the year to date declined from a 233 percent annual spike in late October as the government repays old debts.
Obligations have piled up as the Duterte government relies heavily on debt to fight the virus that has sickened more than 464,000 people in the country and pushed the economy into a deep recession. Broken down, most of the 11-month gross loans were obtained in the country, while the rest were borrowed by foreigners.
Since the beginning of the year, gross local obligations amounted to P2.46 trillion, 260.8% more annually. Of that amount, P1.1 trillion was raised through weekly auctions of bonds and treasury bills, while P827.1 billion came from the sale of retail treasury bonds earlier this year.
Increased local debts were the P540 billion that the government borrowed from Bangko Sentral ng Pilipinas in October. The fresh cash loaned by the BSP would be interest free and will be paid until December 29.
In March, the central bank bought $ 300 billion worth of government bonds, which had been repaid in October, to help bolster the country’s pandemic war chest.
On the other hand, gross external liabilities increased 94.5% year-on-year to P583.6 billion from January to November. The amount includes project loans (P32.9 billion) and program loans (P364.6 billion) available from the government, as well as proceeds from the issuance of global bonds (P118.7 billion) and euro bonds. (P67.3 billion). at the beginning of this year.
The latest Treasury data showed that the government debt burden amounted to P10.03 trillion as of October, an increase of 7.03% or P658.81 billion from the previous month. If anything, increased lending is necessary to bridge a record budget deficit this year, which is capped at 7.6% of gross domestic product.
The government borrows from local and international markets to cover its budget deficit, also set to hit a record this year, and pay off old debts.
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