MANILA, Philippines - The successful sale of Food Terminal Incorporated (FTI) to the country's biggest property developer will further strengthen the government's fiscal position this year, Department of Finance (DOF) on Wednesday.
Finance Assistant Secretary Ma. Teresa S. Habitan said in an interview that proceeds from FTI sale is an "unprogrammed revenue" for the national government, which will be used for the Comprehensive Agrarian Reform Program and projects of the Department of Agriculture.
"We're just very pleased about the outcome from a fiscal point of view. We have programmed only P2- billion revenue from privatization this year, but FTI was sold at P24.33 billion," Habitan said.
She also said that the proceeds will help the Bureau of Internal Revenue (BIR) and Bureau of Customs with their shortfalls in collections in the first semester of the year.
"The sale is positive for our revenue, it will offset the current shortfall in revenue, but we are still hopefully that the revenues agencies will step up collections in the second half of the year," Habitan said.
When asked about FTI's impact on the overall budget deficit for 2012, Habitan said it is too early to tell if the sale will reduce the fiscal gap at end-June, as the Aquino administration needs to further accelerate spending in a wake of floods that hit Metro Manila and nearby provinces.
"It will all depend on how fast the acceleration will be in our agencies and the budget department," the finance official explained.
"Revenues from FTI privatization will be booked in October given the 60 working days agreement between the Ayala Land Incorporated and Privatization and Management Office," she added.
Finance Secretary Cesar V. Purisima earlier said that the government will continue to increase its spending in the second semester while revenues rise, putting the Philippines to be on track to meeting its fiscal consolidation program.
The national government posted a P34.48 billion budget deficit in January to June, significantly lower than the programmed P109.34 billion for the period. The fiscal gap in the first-semester was higher than the P34.48 billion it incurred in the same period last year.
In June alone, the government registered P11.69 billion budget deficit, up by 52 percent from P7.69 billion in the same month last year.
Revenues in June alone amounted P115.276 billion against expenditures which amounted to P126.972 billion. From January to June, aggregate revenues summed up to P760.921 billion, financing P795.403 billion in expenditures.