By Mario Casayuran
The country’s budget status is being strained during the current coronavirus disease (COVID-19) crisis because it is operating within the Congress-approved 2020 P4.1 trillion national budget, Department of Finance (DOF) Secretary Carlos Dominguez III told the Senate Tuesday.
Dominguez gave this assessment when asked by Sen. Emmanuel D. Pacquiao about the financial capacity of the Duterte administration to sustain COVID-related programs as the country faces its worst financial status over the past three decades.
He explained that the Bayanihan Act allowed the President to realign unspent funds from programs in the 2019 national budget.
Sen. Panfilo M. Lacson earlier said the government still has more than P70 billion in the 2019 national budget, untouched.
In his testimony in a teleconferenced plenary session of the Senate, Dominguez told Pacquiao that the government was forced to borrow from abroad to sustain its programs because tax collections dropped during the current COVID-19 crisis.
The DOF chief said the government still has some debt ceiling since it borrowed little in the past.
The total debt in relation to the gross domestic program in 2019 was 39.6 percent “and we project it will hit close to 50 percent of GDP to support the most vulnerable members of society,” Dominguez said.
He said the Philippine government has borrowed $3.9 billion from the Asian Development Bank (ADB), $1.3 billion from the World Bank, and $750 million from China’s Asia Infrastructure Investment Bank (AIIB).
Dominguez explained that the Philippine government has borrowed domestically through treasury bills (TBills) to support its operations.
He pointed out that foreign borrowings represented 25 percent of its total borrowings with the majority, 75 percent, borrowed domestically.
Asked if the fiscal position of the government might reach critical levels in case of a second wave of COVID-19 infections takes place, Dominguez cited a testimony of Department of Health (DOH) Secretary Francisco Duque III that any future lockdowns would be localized.
This means that the entire Metro Manila area and some key cities or provinces will not be subjected to enhanced community quarantine (ECQ), but only some barangays or cities would be covered by ECQ, Dominguez said.