BOGOTA: Colombia's government has proposed increasing the amount of so-called TES treasury bonds it will issue in 2020 by 7 trillion pesos ($2.12 billion), in a bid to raise funds to pay healthcare debts.

The proposal, made public on Wednesday, is included in an $84 billion budget plan sent by the government to Congress this week. If approved, the proposal would increase the total TES paper set to be issued next year to 37.1 trillion pesos from 30.1 trillion.

The funds raised would "replace liabilities from judicial decisions that are in arrears and delays in obligations to the health system," the document said.

Despite the increase in the total amount of local bonds, the amount expected to be issued via auction would remain at 23 trillion pesos, the document added.

More bonds being on offer was unlikely to please the market, Banco de Bogota said in a note to investors.

"Though the offer of TES will not be made via auction, but through public entities, the reaction of the market will surely not be favorable, because in any case it means a larger offer of this paper," the note said.

The budget proposal is expected to be debated over the next several months. It must be approved by Oct. 20 and would be a 9.16% increase on the budget approved for this year.

Finance Minister Alberto Carrasquilla said on Tuesday the country will need to raise some 8 trillion pesos ($2.4 billion) to finance the budget proposal.