Philippines plans $23.7 bln fund-raising for budget, infrastructure projects

MANILA, Feb 7 (Reuters) - The Philippines aims to raise $23.71 billion from external sources to bridge a planned budget deficit and fund priority projects this year, including $5.5 billion from the commercial markets, the Department of Finance said on Sunday.

The amount is 39% higher than the $17.01 billion the government raised from external sources last year for key infrastructure projects and for helping bridge a wider budget deficit due to state spending on COVID-19 response measures.

A total of $8.06 billion of this year’s amount will be for budget support purposes, while the balance of $15.65 billion will be for project financing, the DOF said in a statement.

This year’s budget of 4.5 trillion pesos ($93.7 billion), the country’s largest yet, is intended to bankroll an economic recovery and fund the purchase of millions of doses of COVID-19 vaccines.

The government is targeting full-year growth of 6.5%-7.5% for the pandemic-hit economy, which contracted by a record 9.5% last year.

This year the government plans to secure $7.67 billion in loans and grants from multilateral institutions, $10.54 billion from bilateral sources, and $5.5 billion from the debt markets, the DOF said.

Last year, the DOF secured $7.73 billion from multilateral lenders, $2.86 billion from bilateral partners, and $6.47 billion from commercial markets.

Of the total external financing contracted in 2020, around $15.44 billion was for emergency requirements for the government’s COVID-19 response, while $1.62 billion was for other initiatives including infrastructure projects.

($1 = 48.04 Philippine pesos)

Reporting by Enrico Dela Cruz; Editing by Kim Coghill