Department of Finance Secretary Ralph Recto vowed to maintain the agency’s financial management practices after the Philippines secured the top spot for debt transparency in the 2024 Investor Relations and Debt Transparency Report by the Institute of International Finance (IIF).
“It is very encouraging to see that the Philippines is setting a global benchmark in investor relations and debt transparency,” Recto said in a statement.
“Transparency is most important, especially regarding government debt. We release data regularly to clearly show the public where their taxes and our borrowings go. This transparency reflects the Marcos, Jr. administration’s commitment to managing the country’s finances prudently and sustainably to ensure a future of fiscal stability for Filipinos,” he said.
Recto said the achievement is also the result of the DOF’s proactive engagements with creditors and investors. “Through constant dialogues, we equip our creditors and investors with the knowledge and insights needed to make informed assessments of our country’s performance,” he said.
The IIF said of the 50 countries it surveyed, the Philippines scored the highest in debt transparency at 12.5 out of 13. The debt transparency score assesses sovereign borrowers’ data and policy dissemination practices.
It takes into account the countries’ adherence to enhanced transparency practices; user-friendliness of macroeconomic and environmental, social, and governance (ESG) data formats; and availability of ESG data, among others.
The Philippines also ranked first in the survey on investor relations with a near-perfect score of 48.8 out of 50. It evaluates the overall investor relations practices of countries across 23 criteria.
The Philippines’ debt transparency initiatives are being led by the Bureau of the Treasury (BTr) which releases to the public regular comprehensive reports on the central government’s fiscal outturns and debt portfolio.
These include the national government cash operations report (COR), which outlines the actual monthly and annual revenue collections, expenditures and financing of the national government.
The BTr also discloses the national government debt (NG Debt) report monthly, which provides details of the outstanding obligations of the government.
The government also releases an annual fiscal risk statement (FRS), which outlines current trends concerning macroeconomic and fiscal performance, public debt, monetary policy as well as potential risk exposure and mitigation measures in place.
By practice, the BTr fosters predictability by providing market participants with insight regarding the intended tenor and volume of treasury bills and bond issuances through an auction calendar.
The auction calendar is crafted based on the feedback obtained from quarterly market consultations with Market Makers, focusing on anticipated investor demand. This enables investors to anticipate supply dynamics and adjust cash operations accordingly, reducing uncertainty and mitigating potential bond market fluctuations while also supporting the successful issuance of government securities.
Auction results are also released publicly by the BTr on the same day, which include a summary of the amount offered and awarded, yields, and archives of past auction results for reference and analysis.
Data on outstanding government securities, including coupon rates, face value and maturity dates are also published monthly to allow the public to track the magnitude and composition of government debt over time and demonstrate the government’s commitment to transparency and accountability.
On strengthening investor relations, the DOF engages in multiple domestic and international Philippine Economic Briefings (PEBs) to serve as an avenue for the government to provide investors with updates on the country’s economic and financial performance, as well as developments on key policies and programs.
More importantly, the PEBs provide investors with the opportunity to share their insights and express their concerns with the government for better policymaking.
Since Secretary Recto took office, the Philippines already held PEBs in Manila, the United States and Japan.
Apart from this, the DOF also participates in both transaction-related and non-deal investor roadshows to showcase the country’s bond issuances in the international market, build investor relationships, and gauge market sentiment.
The DOF also regularly meets up with credit rating agencies to discuss significant economic developments that could impact the country’s risk assessment and creditworthiness.
The BTr facilitates engagements with fund managers to proactively address inquiries regarding the country’s funding initiatives.
With its commitment to enhancing financial literacy and inclusion, the BTr regularly hosts financial literacy sessions in collaboration with other agencies and organizations to cater to small retail investors.
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