THE Monetary Board’s (MB) approved government foreign borrowings rose by 25.38% year on year in the second quarter, the Bangko Sentral ng Pilipinas (BSP) said.
Approved public-sector foreign borrowings jumped to $4.89 billion in the three months through June from $3.9 billion in the same period a year ago, the central bank said in a statement late on Monday.
Broken down, the approvals consisted of eight project loans amounting to $4.14 billion and three program loans worth $0.75 billion.
“The approved foreign borrowings have medium- to long-term maturities,” the BSP said.
“The loans are meant to fund projects and programs on road and rail transport, flood control management, climate resilience, health services, and civil service modernization,” it added.
Under the Constitution, the Monetary Board is required to approve any foreign loan agreements entered into by the National Government (NG).
The BSP must also approve in principle any foreign borrowing proposals by the NG, government agencies and government financial institutions before actual negotiations.
The Monetary Board must submit a report of its decision on these applications for loans within thirty days from the end of every quarter of the calendar year.
The central bank said these approvals are in line with its task of “ensuring that the country’s foreign debt remains manageable.”
Latest BSP data showed outstanding external debt rose by 14% to $146.74 billion at the end of March. This brought the external debt as a percentage of gross domestic product (GDP) to 31.5% from 29.8% in the fourth quarter.
The BSP’s external debt data cover borrowings of Philippine residents from nonresident creditors, regardless of sector, maturity, creditor type, debt instruments or currency denomination.
Latest Treasury data showed the NG’s gross borrowings surged by 78.16% year on year to P263.99 billion in June. This came as gross external debt soared to P96.41 billion during the month.
From this year until 2027, the National Government plans to source at least 80% of its borrowing program from domestic sources and 20% from foreign lenders. — Luisa Maria Jacinta C. Jocson