Philippine government seeks another US$11b funding support from central bank

[MANILA] The Philippine government has sought another US$11.24 billion in financial support from the central bank, the third time it has done so this year, to mitigate the impact of the coronavirus pandemic, its treasurer said on Tuesday.

The funding support the government was requesting from the Bangko Sentral ng Pilipinas (BSP) will be in the form of a loan, National Treasurer Rosalia de Leon said.

In October, the BSP agreed to lend the government 540 billion pesos ($S14.9 billion). That followed a decision in March to buy 300 billion pesos of government securities to help handle the fallout of Covid-19.

The central bank has been aggressive in easing monetary policy, slashing its key rate by 200 basis points cumulatively this year, to reduce pandemic's economic damage, but fiscal support from the government has been limited.

With more than 470,000 infections and more than 9,000 deaths, the Philippines has the second highest Covid-19 cases and casualties in Southeast Asia, next to Indonesia.

About a thousand new cases are still being reported daily, despite varying levels of restrictions imposed in the capital since mid-March.

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The Philippine government is targeting a 6.5 per cent to 7. per cent economic growth in 2021 after a projected 8.5 per cent to 9.5 per cent contraction this year.

REUTERS