MANILA – Finance Secretary Carlos Dominguez III is discounting the need to take additional borrowings from the Bangko Sentral ng Pilipinas (BSP) to boost government financing, citing that the government is now banking on its various fiscal programs.
“At this point in time we don’t see any need to do so,” he said in an interview by Bloomberg TV on Tuesday.
Dominguez said the government currently has a PHP540-billion provisional advance from the central bank, which the BSP’s policy-making Monetary Board (MB) approved last October.
This is on top of the PHP300 billion that the BSP extended to the national government last March through a repurchase deal, which has been fully redeemed.
Under this deal, the central bank bought government securities, which the Bureau of the Treasury (BTr) has to redeem within three months, although there was a clause in the agreement that payment period may be extended for another three months.
The central bank’s Charter allows it to extend cash advance to the national government, but the amount should not exceed the government’s average revenues in the last three years, which, to date, is PHP540 billion.
Dominguez said the government “still have some reserve amounts with the central bank and with our other creditors”.
“And we’re just waiting to see if we will need them depending on how long this contagion is going to last. But as I said with the development of safe and effective vaccines by next year (and with) their availability we see no need to get out of the normal loan programs that we have planned,” he added. (PNA)