THE national government plans to borrow less in foreign and domestic markets next year than in 2009 as it plans to rein in spending to help narrow next year’s budget shortfall, documents from Bureau of Treasury showed.
The government plans to raise 640.28 billion pesos ($13.33 billion) in foreign and local debt markets in 2010, down 2 percent from this year’s planned debt issues of 652.98 billion pesos, according to a copy of the documents.
Of the total, 163.09 billion pesos will be borrowed abroad and the balance will be covered by sales of treasury bills and bonds in the domestic debt market.
Budget Undersecretary Laura Pascua said last week the government is looking at a 5 percent increase in next year’s spending plan compared with a near 15 percent hike in 2009 to reflect efforts to narrow its budget deficit.
From an expected record budget gap of 250 billion pesos, or 3.2 percent of gross domestic product this year, Manila wants to reduce the gap to 208 billion pesos, or 2.5 percent of GDP, consistent with plans to balance the budget by 2013.
Government officials have raised the possibility of prefunding some of its 2010 foreign debt to take advantage of relatively low interest rates and avoid market uncertainty ahead of elections in May.
Finance Secretary Margarito Teves said on two separate occasions last week the government had the option of raising funds through a Samurai offer this year, and it was not ruling out the possibility of returning to the global market again this year.
The Philippines, Asia’s most active sovereign debt issuer, sold $750 million in dollar bonds earlier this month after issuing similar debt in January to raise $1.5 billion.
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