MANILA -- National Treasurer Rosalia De Leon is considering a lower borrowing program for the third quarter of 2019 given the delay in the approval of this year’s national budget.
She said borrowing in the third quarter might be below the PHP315 billion in the second quarter.
She explained that because of the national budget's delayed passage, which was signed into law by President Rodrigo Duterte only in April, the government has not fully utilized the budget for the first half of the year.
The government operated on a re-enacted budget for the first quarter of 2019.
Bureau of the Treasury (BTr) data show that total expenditures as of last April reached PHP999.8 billion, 3.2 percent lower than the PHP1.033 trillion for the same period last year.
De Leon explained that although the government has a catch-up plan on the spending program to address the impact of the delayed budget approval, authorities have yet to see results this month.
The government plans to spend about PHP2.996 trillion from the second to fourth quarter of this year, with budget for infrastructure program set at about PHP792.97 billion.
For the whole year, government spending was set at PHP3.774 trillion while infrastructure spending is targeted to reach PHP1 trillion, or about 5.2 percent of gross domestic product.
Relatively, the government continues to enjoy a healthy cash position since aside from below-programmed spending due to the budget delay it was able to raise funds after the issuance of RMB2.5 billion (PHP19 billion) worth three-year renminbi-denominated Panda bond last May and EUR750 million worth of eight-year Euro bond.
The Panda bond is a debt paper issued by a non-Chinese issuer in China.
“Also, the collections are pretty good so we have more than enough cash to be able to finance the sustained higher spending for the next quarter or so,” de Leon said.
Meanwhile, the National Treasurer said Philippine authorities are scheduled to hold a roadshow in Tokyo, Japan next week in line with the planned issuance of the yen-denominated Samurai bond.
The Samurai bond is a yen-denominated debt paper issued by a non-Japanese entity in Japan.
De Leon said they are still finalizing the schedule of the issuance as well as duration of the tenor, which is eyed to be between three to seven years.
The current government has been issuing these foreign currency-denominated bonds in a bid to remain active in the capital markets overseas.
Last year, the Philippine government issued 154.2-billion yen worth of multi-year Samurai bond and 1.46-billion renminbi worth of three-year Panda bonds. (PNA)
