The Philippine government is planning to borrow more from domestic and foreign markets to finance the budget deficit this year, due to the economic slowdown triggered by the COVID-19 outbreak.
Illustrative image. (Photo: philstar.com)
Secretary of the Department of Finance Carlos Dominguez said the government is mulling the possibility of increasing its borrowing plan for the year as the projected budget shortfall could reach 3.6 percent of gross domestic product instead of the programmed 3.2 percent of GDP, if the COVID-19 threat lingers until the middle of the year, reported Philstar.com.
Dominguez said for this year, the government is planning to ramp up its borrowings to 1.4 trillion peso (about 27.46 billion USD), 17.6 percent higher than that of last year. Of the total amount, about 75 percent will come from local sources, while the remaining 25 percent will come from foreign creditors.
The total of foreign commercial borrowings through issuing bonds in US dollar, euro, Japanese yen and Chinese yuan is estimated to be 3.5 billion USD, while programme loans, project loans and official development assistance (ODA) sources would be about 3 billion USD.
According to Dominguez, government revenues could decline by 91 billion peso (1.78 billion USD)./.