THE national government has programmed a total of P120-billion borrowings from the local debt market in December, which is lower compared to what was set for this month.
The Bureau of the Treasury (BTr) is set to auction off a total of P60 billion in Treasury bills (T-bills) and P60 billion in Treasury bonds (T-bonds) next month.
The BTr memorandum on Thursday showed that P20 billion worth of T-bills with 91-day, 182-day and 364-day tenors are up for sale on December 1, December 7 and December 14.
Meanwhile, P30 billion in 3-year T-bonds will be offered on December 2 and another P30-billion worth of 7-year T-bonds will be sold on December 15.
National Treasurer Rosalia V. de Leon told reporters that the 7-year T-bonds were reissued, noting that the remaining life of the bonds ranges from three to four years only.
Comparing December’s borrowing to this month, it is lower by P20 billion. In November, the government set its borrowings from the debt market at P140 billion. This is composed of P80-billion T-bills and P60-billion T-bonds.
“With the year winding down, the BTr opted for a smaller borrowing plan with disbursement and expenditures expected to fall with authorities looking to limit the size of its budget deficit,” ING Bank Manila Economist Nicholas Antonio T. Mapa said.
In the first 10 months, the government’s budget gap grew by almost threefold to P940.6 billion from P348.3 billion in the same period last year as expenditures surpassed revenues.
“Government officials have been adamant to protect their fiscal metrics and we can expect this trend of modest spending and deficit financing via the [Central Bank] to continue with moderately sized borrowing plans to fund the republic,” he added.
Meanwhile, RCBC Chief Economist Michael L. Ricafort said that with the easing lockdown measures, the government is expected to have better tax revenue collections.
“As the economy further reopens from the Covid-19 lockdowns, government tax revenue collections also continued to pick up gradually from the worst/lowest levels during the height of the lockdowns, thereby fundamentally reducing the need for more government borrowings, especially in view of the Christmas spending season when tax revenues also correspondingly increase,” he explained.
In October, government tax revenue collection improved to P228.2 billion from P212.4 billion in the previous month. Still, revenue collections dropped by 8.41 percent to P2.37 trillion from January to October.
The national government’s gross borrowings reached P2.56 trillion as of end-September. This is more than 85 percent of the all-time-high nominal P3-trillion borrowing program set by the Development Budget Coordination Committee for 2020.
In 2021, the government is also set to borrow another P3 trillion.