The Philippines may raise up to $1bn from a planned Samurai bond issue, up from its previous plan of $500m, if it gets favourable pricing and good demand, a senior government official said recently.
“If we can raise $1bn through samurai, we will do that,” Finance Undersecretary Rosalia de Leon told reporters.
“We will try to maximise whatever we can from the Samurai bond market,” she later said.
The government secured a large portion of its foreign debt needs after it sold $1.5bn worth of dollar bonds early in the month, the first sovereign debt issue in Asia this year which was met by strong demand from investors. It also plans to use part of a $1bn bond sale in October to finance its 2010 budget deficit.
Neighbouring Indonesia also plans to raise up to $1bn from a second samurai bond offering this year to diversify sources of funding.
Manila has said it was hoping to sell yen bonds of about $500m in January, possibly completing its 2010 foreign borrowing needs this year.
But National Treasurer Roberto Tan said the timing of the samurai sale had been pushed back due to documentary requirements.
The Japan Bank for International Cooperation (JBIC) has guaranteed the sale of up to $1bn in Samurai bonds to help Manila finance a record budget deficit.
De Leon told reporters that the government would like to complete its foreign debt issues in the current quarter. It had raised its 2010 foreign debt issues to $2.5bn from an original plan of $2bn to help bridge a higher fiscal gap and refinance debt.
The government faces another record budget deficit this year of 293 billion pesos, or 3.5 percent of GDP, after a shortfall of 290 billion pesos, or 3.7 percent of GDP in 2009.