The Department of Finance (DOF) will continue borrowing mostly from the domestic debt markets under the Marcos administration on the back of the growing appetite of Filipino retail investors in government securities.
In a statement on Tuesday, Aug. 23, Finance Secretary Benjamin E. Diokno said President Duterte intends to raise the government's local financing to 75 percent from around 73 percent drawn from domestic creditors between 2016 and 2021.
For 2022, the government aims to raise P2.2 trillion to enable the economy’s strong and resilient growth, Diokno said.
“The Marcos administration plans to continue this borrowing mix by obtaining 75 percent or around P1.65 trillion from domestic markets to insulate the country from foreign exchange volatilities due to ongoing global uncertainties,” Diokno said.
In the first half of 2022, the government has already raised an estimated P741 billion.
Meanwhile, Diokno lauded the Bureau of the Treasury’s launch of the 28th tranche of its retail treasury bonds, the government’s first offering under the Marcos administration.
“This issuance serves as an important component of the national government’s fundraising efforts to finance our development programs aimed at building a sustainable, inclusive, and broad-based economy,” Diokno said.
Diokno said that retail treasury bonds are safe, low-risk, and affordable investment instruments.
With a minimum investment amount of P5,000, retail treasury bonds allow investors to contribute to nation-building while growing their hard-earned savings with better returns.
“hese relatively higher yielding government securities strengthen financial inclusion and encourage broader participation in the capital market,” said Diokno.
Retail treasury bonds have been the strongest performing financial instrument in the Treasury’s portfolio of bond offerings in the last two decades.
Since the first issuance in 2001, the government has raised over P4.37 trillion from these offerings.
Diokno said that the country’s growing retail sector is proof that the retail treasury bonds are a viable pillar of domestic financing.
With their consistently strong reception from both local and overseas investors, the retail treasury bonds now account for around 35 percent of the Treasury’s outstanding government securities.