Gov’t asset sale to cover Covid costs nixed

April 19, 2020

Finance Sec. Carlos Dominguez III does not see the need to sell state-owned properties to finance the coronavirus disease 2019 response.

Dominguez said the government is now in a “very good financial position” to address financial requirements of the pandemic's impact.

He said: “The worst possible scenario, maybe at some point, we may sell some assets but at this point, that’s not yet necessary.”

“And frankly, I don’t think that it will be necessary… I don’t believe that will ever happen,” he added.

President Duterte had earlier said he would sell government assets if the need arises in addressing the impact of Covid-19.

The DoF chief said policies implemented since the start of the Duterte administration in 2016 resulted in higher government revenues.

He said the President also “spent money very wisely” and this, among others, sealed credit rating upgrades for the country.

In April 2019, S&P upgraded its investment-grade rating on the country from “BBB” to “BBB+” with a Stable outlook due to strong domestic growth, healthy external payments position, and sustainable public finance.

In October last year, Moody’s Investors Service kept its Baa2 with Stable rating on the country because of the strong fiscal position, and “limited vulnerability” to external risks.

Last February, Fitch Ratings changed its rating outlook on the country’s “BBB” rating from stable to positive due to “sound macroeconomic policy framework that will support high growth rates with moderate inflation, progress on fiscal reforms that should keep government debt within manageable levels and continued resilience in its external finances”.

“So (the) President has really done a very good (job). Economically, we are growing and we are in a very good position,” he said.

The government has formulated a four-pillar program to address the health and economic impact of global pandemic.

Aside from the funds sourced from the realignment of this year’s national budget, the Bangko Sentral has extended a P300-billion fund after it bought government securities, which would be repurchased by the national government at a maximum period of six months.

The government has also secured a $500 million loan from the World Bank and a $3-million grant from the Asian Development Bank.

Dominguez said external fund sources  would be tapped if current funds are not enough for the requirements.