The central bank’s Monetary Board has approved $2.84 billion worth of public sector foreign borrowings in the first three months of 2021, up by 19.36 percent from same time last year of $2.38 billion.
In a statement Monday, (May 3) the Bangko Sentral ng Pilipinas (BSP) said a large portion of the foreign loans that went through their review and assessment process were six project loans worth $1.44 billion.
The BSP also approved two government bond issuances amounting to $798 million and a $600-million program loan.
The $2.84 billion BSP-approved project loans include the government’s $900 million COVID-19 pandemic response programs for vaccine procurement and distribution, and also its $798 million refinancing of existing obligations and general financing requirements.
It also approved the government’s $600 million project loan for disaster resilience; it’s $300-million loan for social protection; and two other loans for public transport improvement worth $138 million and $105 million for maritime safety.
To make sure foreign debt level continue to be manageable, the BSP is mandated to review and approve all public sector or government foreign borrowings under Section 20, Article VII of the 1987 Philippine Constitution.
All National Government, government agencies and government financial institutions’ proposed foreign borrowings will need the BSP’s approval-in-principle before negotiating for these loans.
Last week, the Department of Finance announced that as of end-April this year, the government has borrowed $18.4 billion from external sources, of which $16.26 billion is for budgetary financing and $2.14 billion for project financing.
In 2020, the country’s outstanding external debt went up by 17.8 percent year-on-year to $98.488 billion, or 27.2 percent of GDP. The last time the external debt to GDP was at this level was in 2013, and it has been under 23 percent to GDP ratio since 2017.