Politics

LGU borrowing proposals sharply lower at end of July

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NEW BORROWING sought by local government units (LGUs) declined by 71.34% year on year to P20.8 billion in the seven months to July, the Bureau of Local Government Finance (BLGF) said.

According to preliminary data, the BLGF issued 113 certificates of net debt service ceiling and borrowing capacity to LGUs, against 273 issued a year earlier.

The document is a proxy for the borrowing intentions of local governments, whose capacity for taking on debt must be certified by the BLGF, an arm of the Department of Finance.

The certificates of net debt service ceiling and borrowing capacity were issued to 81 municipalities, 23 cities, four provinces, and five barangays.

LGUs’ total borrowing capacity was P48.65 billion, down by  72.19% from a year earlier.

Cities applied to borrow P8.16 billion, followed by municipalities (P7.79 billion), provinces (P4.83 billion), and barangays (P24.65 million).

Cities also had the highest total borrowing capacity at P26.15 billion, followed by municipalities (P16.41 billion), provinces (P6.05 billion), and barangays (P37.24 million).

In July, the BLGF released two certifications to LGUs covering proposed loans worth P1.09 billion, against the P6.9 billion seen in the same month of 2021.

Aurora province was the leading availer of loans in July with P940 million. Pagadian City availed of P150 million. — Diego Gabriel C. Robles