Lower domestic borrowings for gov’t seen in Q3

MANILA, Philippines - Domestic borrowings in the third quarter may be less than the P135 billion planned in the previous quarter, a Bureau of Treasury official said.

Deputy Treasurer Sharon Almanza told reporters that the borrowing program for July to September may sum up less than the planned ceiling for the second quarter.

“We are open to reducing the volume considering the available cash that we have. The borrowing program is possibly lower than (that in) Q2,” Almanza said.

The government has programmed a P135-billion worth of debt paper issuance to local lenders for this quarter.

The bulk of P75 billion will be raised through the sale of short-tenored Treasury bonds (T-bonds), while the remaining P60 billion will come from the issuance of Treasury bills (T-bills).

The government conducts auctions of securities to fund the country’s budget and also provide investors with options.

In the first quarter, the government has raised P84.67 billion from the issuance of T-bills and T-bonds. 

The government has relied heavily on domestic borrowings last year amid the local financial system’s ample liquidity and also to reduce some pressure on the exchange rate.

Almanza said that for next year, the government may adopt a financing mix of 86:14, in favor of domestic sources, adjusted from the previous 89:11.

“We are open to have some for international issuance, but we will be limiting external financing to $2.2 billion,” the Deputy Treasurer said, adding bulk of the figure will be from multilateral agencies.