DOF secures $17-B foreign loans for budget support, projects in 2020

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Metro Manila (CNN Philippines, February 7) - The Department of Finance had secured a total of US $17.06-billion foreign loans in 2020 for key infrastructure projects and to help bridge the wider fiscal deficit due to huge amount spent on pandemic response.

Through its International Finance Group, the DOF said that it was able to secure last year $7.73 billion from multilateral lenders, $2.86 billion from the country's bilateral partners, and $6.47 billion from the commercial markets.

Of the $17.06 billion loans contracted in 2020, around $15.44 billion was allotted for emergency requirements for Covid-19 response and $1.62 billion was allotted to other government initiatives including the "Build, Build, Build" program.

"Because of a higher emergency funding requirement in light of COVID-19, the amount of external financing contracted in 2020 increased by 75.43 percent year-on-year. This also represents an overall 33-percent expansion of the external borrowing program from 2016 to 2020," said Finance Usec. Mark Dennis Joven in a statement.

Aside from loans, DOF's IFG also processed grants and technical assistance amounting to $859.53 million last year. Of this amount, $26.74 million was allotted for Covid-19 pandemic response.

"In 2020, the IFG also facilitated the provision of various donations, such as testing kits, masks, personal protective equipment (PPEs), ventilators, face shields, and others, from China," said Joven.

Moreover, the DOF is aiming to secure $23.71 billion foreign loans for 2021. Of this amount, $8.06 billion will be allocated for budget support purposes and $15.65 billion will be spent on other government projects.

"We are planning to source a total of US$7.67 billion in loans and grants from multilateral institutions, US$10.54 billion from our bilateral partners; and raise US$5.5 billion from the commercial markets this year," said Joven.