THE Philippine government is set to borrow a total of P140 billion from the local debt market in November, the same amount that it programmed to borrow this month.
Broken down, the Bureau of the Treasury will be auctioning off a total of P80 billion in Treasury bills (T-bills) and another P60 billion in Treasury bonds (T-bonds) next month.
Based on the memorandum released by the Bureau of the Treasury on Wednesday, a total of P20 billion in T-bills consisting of 91-day, 182-day and 364-day tenors is slated to be offered on November 3, November 9, November 16, and November 23.
Meanwhile, P30 billion in 3-year T-bonds will also be offered on November 3; while another P30 billion in 5-year T-bonds will be up for sale on November 17.
National Treasurer Rosalia V. de Leon told reporters the borrowing program was set “based on auction results with intermediate part of curve as sweet spot.”
To recall, the Bureau of the Treasury no longer offered 10-year T-bonds this month as investors are now keener on shorter tenors.
On top of T-bills and T-bonds, the Treasury earlier said it was targeting to raise P3 billion from one-year Premyo bonds next month.
According to de Leon, they are set to launch their second offering for Premyo bonds on November 11.
Last year, the government generated P4.961 billion from the maiden sale of Premyo bonds.
The government has more than doubled its borrowing program this year to an all-time high nominal P3 trillion from P1.4 trillion originally, to cover the expected doubling of the budget deficit as well as to fund its spending requirements for Covid-19 response.
As of end-September, gross borrowings of the national government have already reached P2.56 trillion, equivalent to more than 85 percent of the all-time-high nominal P3-trillion borrowing program set by the Development Budget Coordination Committee (DBCC) for this year.
For next year, the government is also set to borrow another P3 trillion.
As tax collections are down amid the pandemic, the DBCC projects the budget deficit to more than double to 9.6 percent of GDP or P1.815 trillion this year from only 3.4 percent of GDP or P660.2 billion last year.
The latest data from the Bureau of the Treasury showed the budget gap of the national government from January to September swelling to P879.2 billion, almost three times the P299-billion shortfall a year ago. However, it also said the January to September budget deficit is still 32.3 percent below the revised program of P1.298 trillion for the period.
Meanwhile, the DBCC also expects the country’s debt-to-GDP ratio this year to increase to 53.91 percent of GDP—a level that it has not seen in over a decade—from a record-low of 39.6 percent of GDP last year. By the end of this year, the national government expects its outstanding debt to reach P10.16 trillion, up by 31.42 percent from last year’s amount.
As of end-August, the country’s debt stock has already swelled to P9.6 trillion as it secures more borrowings to finance its spending needs amid the Covid-19 pandemic.