Finance Secretary Ralph Recto on Monday said the government is looking to offer samurai and US dollar bonds this year.

Recto said the additional foreign borrowings are part of the government’s $5-billion debt program for this year.

He said the Bureau of the Treasury is studying trends in offshore interest and foreign exchange rates to determine the specific opportune time to issue foreign-denominated bonds.

Lowest rate possible

“Our first mandate is if we have to borrow, we borrow at the lowest rate possible,” Recto stressed.

He said the government will likely offer US bonds once the Federal Reserve cuts its policy rate.

The government already raised $2 billion from its issuance of dual-tranche global bonds on 8 May.

Proceeds from these bonds will be used for general budget and refinancing of climate change-related projects under the government’s Sustainable Finance Framework.

Due to external risks in foreign loans, Recto said the government will continue to mostly borrow from domestic sources with 75 percent of the total debt program.

Recto said proceeds from the bond issuances will augment government funds which are accumulated from tax and non-tax revenues.

He shared that the government has collected total revenues of P2.13 trillion in the first six months, which is 14.6 percent higher compared to the same period a year ago and half of the P4.27-trillion target for this year.

Tax collection reached P1.81 trillion in the first half or 8.8 percent higher. This reflected the Bureau of Internal Revenue’s collection of P1.34 trillion or 10.2 percent growth, and the Bureau of Customs’ P454.1 billion or 4.8 percent growth.

Our main job at the Department of Finance is to ensure ample resources to fund our nation’s HEARTS: Health, Education, Agriculture, Roads and Infrastructure, Technology, and Security and Social Protection.

Recto said he expects tax revenues to increase annually by 11.8 percent on average as the government improves digital tax processes, especially of the e-commerce industry.

Total revenues growth target

The government aims to grow total revenues each year by an average of 10.3 percent, leading to a P6.25-trillion revenue by 2028.

“Our main job at the Department of Finance is to ensure ample resources to fund our nation’s HEARTS: Health, Education, Agriculture, Roads and Infrastructure, Technology, and Security and Social Protection,” Recto said.