STATE BORROWINGS ballooned to nearly P2.5 trillion in the first eight months of the year, following the National Government’s (NG) jumbo retail Treasury bond (RTB) sale in August.
Data from the Bureau of the Treasury (BTr) showed the government’s gross borrowings stood at P2.47 trillion as of end-August, more than double the P916.271 billion borrowed in the same period last year.
Since May, the government’s borrowings have exceeded the P1.02 trillion it raised for the entire 2019, as it sought to beef up funds for its pandemic response.
In August alone, gross borrowings surged more than eight times to P612.913 billion from P76.524 billion a year ago due to the RTB sale.
Gross domestic borrowings, which accounted for 95% of the total, reached P584.374 billion last month, climbing 19 times from P29.67 billion in August 2019 and up almost nine times from P66.837 billion in July.
The bulk came from the five-year RTB sale that raised an all-time high of P516.34 billion.
The Treasury issued P38 billion in Treasury bills (T-bills) and P30 billion in Treasury bonds (T-bonds), down by 50% month on month.
Excluding the P28.14 billion of repayments made, the government’s net domestic borrowings hit P556.235 billion. Some P100 billion was paid via the redemptions made from the bond sinking fund.
Meanwhile, overall foreign borrowings reached P28.539 billion, down by 39% year on year and 58% smaller than P67.7 billion in July.
This consisted of P26.501 billion in program loans and P2.038 billion in project loans.
The BTr made P2.057 billion in repayments in August, taking the net external borrowings lower to P26.482 billion.
Year to date, gross borrowings accounted for 58% of the government’s P3-trillion borrowing program for the entire 2020, with 65% obtained locally and the rest offshore.
Domestic borrowings reached P1.96 trillion in the January to August, up three times more year on year.
Funds raised through RTBs hit P827.12 billion after the BTr offered it twice this year. In February, the BTr raised P311 billion from the issuance of three-year RTBs.
About P447.86 billion was raised through T-bonds offered regularly and P385.3 billion via the weekly auctions of T-bills.
The BTr also has an outstanding P300 billion worth of securities availed of by the central bank in April under a repurchase agreement.
It paid P89.166 billion in amortization, bringing the net domestic borrowings to P1.871 trillion. It also made P284.84 billion worth of redemptions from the bond sinking fund.
Meanwhile, foreign borrowings reached P509.69 billion, up 85% from the same eight-month period last year.
Program loans worth P306.536 billion made up the bulk, while project loans amounted to P17.1 billion.
The Treasury went to the international debt market twice this year, raising P118.74 billion through dollar-denominated notes in May, and P67.329 billion in its eurobond sale in February.
Excluding the P117.044 billion of repayments made, net external borrowings amounted to P392.647 billion, more than twice year on year.
The total net borrowings hit P2.263 trillion year to date, up almost three times from P802.504 billion a year earlier.
The government borrows from local and foreign lenders to plug its budget deficit that is seen to swell to 9.6% of gross domestic product this year. — Beatrice M. Laforga