Finance Secretary Carlos Dominguez III opposed a government plan to stop payments to mature foreign debts. It aims to unlock cash for COVID-19 response, calling it a “narrow-sighted” measure.
Dominguez shot down Senator Imee Marcos’ call to temporarily postpone loan payments to foreign lenders. It was a tactic from her father, the late strongman Ferdinand Marcos. Therefore, the government can offer more subsidies to poor rural families and businesses.
Marcos, chairman of the Senate Committee on Economic Affairs, said that under the 2020 national budget this would release some 451 billion. The sum includes all domestic and international loan interest payments, as seen by a review with the General Appropriations Act.
Dominguez said in a statement sent Tuesday night, according to CNN Philippines. In addition, he told that by doing so, it would put the track record of the country at risk.
“Debt moratorium hasn’t crossed our minds. It’s never be the consideration or will ever be part of our crisis management measures.”
The Philippines paid its debts to local and international debtors on a daily basis, as they are due. The debt burden is a mixture of short-term and long-term borrowing, piling up as the government invests in growth.
In fact, the debt burden of the country in relation to the economy is 44.2 per cent, lower than a high of 78.3 per cent in 1986, the DOF said. That was the year former president Marcos had been booted out of power. A popular rebellion that elected Corazon Aquino as the leader of the country.
Overall, he said regular debt payments to the Philippines made it credible in the eyes of global banks and financial institutions.