MANILA, Dec 11 (Bloomberg): The Philippine government is seeking a 300 billion peso ($5.96 billion) loan from the central bank next year, lower than this year’s budget support, as it plans that the economy will recover, said Finance Secretary Carlos Dominguez announced.
The government has also informed the Bangko Sentral ng Pilipinas that it will fully repay its interim advances of 540 billion pesos on December 10, ahead of the January 12, 2022 deadline.
The new loan will bear no interest, will be due in three months and can be extended for another three months.
The smaller loan signals that “we are on track with the unwinding of liquidity support on stronger evidence of a return to economic strength,” the finance ministry said, citing Dominguez’s letter to the governor. of the central bank Benjamin Diokno.
The finance chief, at a forum on Wednesday, said government borrowing would start to decline in 2022, with revenues expected to return to 2019 levels.
“This administration will make sure to help the next president and the next generations deal with the fiscal and economic risks induced by the pandemic,” he said.
The economic recovery has started to take hold as more businesses embark on a safe reopening as vaccination continues, Dominguez said.
Even with the threat of new variants of Covid-19, the Philippines’ healthcare system and vaccine stockpile will be sufficient to contain a new outbreak of infection.
“We will consolidate our recovery by reopening the economy at alert level one, hopefully by January 2022,” he told the forum.
A new reopening includes plans to resume face-to-face classes, increase public transport capacity to 100% and ease local and international travel restrictions. -Bloomberg