The Bangko Sentral ng Pilipinas (BSP) approved a total of $1.10 billion in proposed public-sector foreign borrowings in the third quarter of 2025, marking a 71.13 percent decline from the $3.81 billion approved during the same period in 2024.

The approved borrowings, all with medium to long-term maturities, comprise two loans earmarked for social protection projects. As of end-September 2025, total approved public-sector foreign borrowings for the year stood at $12.28 billion.

Foreign borrowings for public sector

The second quarter of this year saw the Bangko Sentral ng Pilipinas report that approved foreign borrowings for the public sector in the Philippines amounted to $4.89 billion, or around a 23 percent drop between quarters.

Foreign borrowings refer to loans obtained by the national government, government agencies, or government-guaranteed corporations from overseas lenders or international markets. These funds are typically used to finance infrastructure development, social programs, or general budgetary support.

The steep year-on-year drop in new approvals reflects improved fiscal management and greater funding flexibility by the national government.

Reliance on domestic financing

It also suggests that the Philippines is relying more on domestic financing sources, such as tax collections and local bond issuances, while strengthening its capacity to generate internal revenues.

However, the decline could also be attributed to fewer infrastructure or development projects being financed, or uncertainty regarding financial policy.

The BSP reiterated that it will continue monitoring the country’s borrowing activities to ensure that foreign debt obligations remain aligned with national development priorities and the overall macroeconomic stability framework.