The Philippines is set to obtain a $500-million loan from the Asian Development Bank (ADB) within the last three months of the year to plug its ballooning budget deficit, which is estimated at P199.2 billion for 2009.

According to National Treasurer Roberto Tan, the amount would also be used to fund the government's spending programs to stimulate the slackening economy.

"It will be part of the expenditure program. ADB is supporting the program stimulus of its member countries," he told reporters on Tuesday. The ADB is planning to launch a $3-billion fund to help developing countries boost spending to overcome the global economic crisis.

The multilateral lender has also increased its lending assistance to $32 billion for this year and the next, higher than $22 billion from 2007 to 2008. Its crisis support plan includes project investments, quick-disbursing policy-based loans, guarantees, and new initiatives.

Last week, Finance Secretary Margarito Teves said the government is more likely to tap loans from ADB and other multilateral agencies as these are "more concessional" and "quick-disbursing" as compared to the global debt market.

"These (multilateral loans) are more concessional and if they are quick-disbursing, I guess other things being equal, it would be prudent to tap this additional loan rather than go to the market," he said, referring to the $500-million loan, at the sidelines of the ADB's annual meeting in Indonesia recently.

The government has already decided to tweak its borrowing program by increasing foreign loans to 28 percent from 25 percent, reducing the amount sourced from domestic creditors to 72 percent from 75 percent.

However, Teves said the government cannot rely heavily on borrowings given the country's huge debt stock, which reached P291.55 billion for the first three months of 2009 from P239.36 billion in the same period last year.

The Philippines, reeling from low tax collections and the need to shield the economy from the global slowdown, has thrice revised its 2009 budget gap since last year.

From P40 billion, the government's deficit ceiling was raised to P102 billion, then to P177.2 billion, then to P199.2 billion recently.