Philippines’ debts now at over P10 trillion. Where’s the money?

FORMER NATIONAL Police chief and now Senator Panfilo Lacson scored the Duterte government’s penchant for borrowing, but not always with the corresponding results.

Lacson said that while borrowing may be necessary for the economy, the government has yet to show results of the trillions of pesos it has borrowed over the years.

“When I first became a senator in 2001, our national government’s outstanding debt was P2.88 trillion. Over the Arroyo, Aquino and Duterte administrations, it has ballooned to P10.027 trillion as of October this year, from P8.2 trillion at end-2019,” he said.

“Thus it is hard to accept the Palace spokesperson’s statement that we will look for funds to acquire vaccines,” he added, referring to Harry Roque’s recent statement on the government’s plan to borrow more money despite the country’s ballooning debts.

Lacson said that in the last nine to 10 months, the Duterte administration’s borrowing accelerated at a record rate, with an additional P1.8 trillion.

He said while the United States has borrowed $27 trillion, their infrastructure development and social services are being adequately provided. “In our case, we have expressways and skyways but they are provided and maintained by the private sector. Tayo, utang ng utang, toll naman ng toll,” he added.

The country continues to sink in debts as the government trumpeted fresh loans running into billions of pesos to fund the purchases of anti-Covid vaccines and other responses to the pandemic.

Debts, Debts, Debts

Duterte had already borrowed billions of pesos since 2016 after winning the election, for his ambitious Build, Build, Build infrastructure projects and dole outs to poor families across the country.

Finance Secretary Carlos Dominguez III told Duterte in one of his briefings that the government has 3 sources of funding through various loan agreements – the Asian Development Bank (ADB), the World Bank and domestic banks such as Land Bank of the Philippines and the Development Bank of the Philippines (DBP), and even Government-Controlled Corporations.

He said government can get as much as P40 billion loans from ADB and World Bank, and another P20 billion from domestic sources. And not only that because Dominguez is also looking to get more loans from bilateral sources in the United Kingdom (UK) and the United States (US) where Covid-19 vaccines are available amounting to over P13 billion.

“Mr. President, may tatlong sources po tayo ng funding okay. Ang first — ang unang source natin ‘yung mga multilateral agencies: ADB at saka World Bank. Ang estimate namin we will have around 40 billion pesos from them. Low cost, long-term loans, 40 billion from multilateral agencies.”

“Tapos mayroon po tayong domestic sources of financing. Ang domestic sources of financing we estimate around 20 billion. So that will come from Land Bank, DBP, and possibly ‘yung mga government-controlled corporations. So that’s 20 billion,” he said.

Dominguez added that the government will negotiate with bilateral sources in UK and US for the purchase of the vaccines.

“Tapos magne-negotiate pa po tayo sa mga bilateral sources depende sa source ng — depende sa source ng vaccine, either England or US or whoever. And ang target po namin doon around 13.2 billion pesos. So ang total niyan is about 73.2 billion financing that it’s pretty much — it’s almost fixed. Most of it is already fixed, 13.2 billion hindi pa completely negotiated. So 73.2 billion pesos,” he said.

Dominguez estimated the cost of the vaccine at around $25 (about P1,200) per person and since the government is targeting to vaccinate some 60 million Filipinos, he said the loans are enough to cover the expenses.

“Ngayon ang estimate namin sa average cost ng vaccine is around 25 dollars — not per dose, per person. ‘Di ba? Around 25 dollars which is 1,200 pesos more or less. Some are lower, some are higher so we don’t know yet exactly how much is the cost. But let’s say 25 dollars or 1,200, 72 — 73.2 billion pesos is good for 60 million people to be vaccinated, around 60 million people. So that is more or less what we have in line. Ngayon, we’ll have to consult with the DOH if 60 million is enough, if 60 million people is enough to be vaccinated,” he explained.

Aside from massive borrowings, Duterte also hiked taxes despite public outcry, saying he needed it to fund government more projects. In August, the Bureau of Treasury said the government’s outstanding debt stood at P9. 615 trillion, but this has already reached over P10 trillion now. (Mindanao Examiner)

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