MANILA, Jan. 27(Xinhuanet)-- The Philippines has raised its original target of 1-billion-US dollar bond issue to 1.5 billion dollars, seeing strong demand for a large bond issue, despite concerns over the country's fiscal position and ratings, officials said Thursday.

"Through this transaction, the Republic has capitalized on market conditions an d succeeded in raising a notable portion of our 2005 funding requirements with long-dated financing," Finance Undersecretary Eric Recto said in a finance department statement.

The government decided to launch the 25-year bonds ahead of theLunar New Year holidays, when some fund managers were expected to be away, and before an expected US interest rate hike early next month, sources said.

This was the largest single issue of bonds by the Philippines at a time when the government has been trying to boost revenues tofund the day-to-day running of the country.

The bonds carried an interest rate of 9.5 percent and were soldslightly below par to give investors an actual return of 9.7 percent.

The Philippines plans to raise 4 billion dollars in foreign borrowings in 2005.