Philippines, Japan set to sign four more infrastructure loans this year
The Philippine and Japanese government are set to sign four more loans for 2019 the administration's big ticket projects under their “Build, Build, Build” program.
In a press conference after their eighth meeting of the Philippines-Japan Joint Committee on Infrastructure Development and Economic Cooperation in Clark, Finance Secretary Carlos Dominguez III said the two governments discussed their strategies for future cooperation considering the Philippines will soon graduate to upper middle income country status by the end of this year or 2020.
Dominguez said Philippines and Japanese delegates agreed on working towards signing the supplemental loan for the ongoing Davao City bypass construction project within this year and three more loan accords.
These are the New Mactan Bridge Construction Project in Cebu, the second phase of the Metro Manila Priority Bridges Seismic Improvement Project, and the second tranche loan for the first phase of the Metro Manila Subway Project.
Dominguez said they also agreed on maintaining close coordination to resolve pending issues and revisit certain procedures to achieve the timeline.
During the meeting, they also reviewed the progress of the Philippines railway projects that were rolled out in cooperation with Japan and committed to continue consultation to speed up implementation and address all challenges.
“(We) conduct feasibility studies by the Japan International Cooperation Agency (JICA) for the Dalton Pass East Alignment Alternative Road Project and Circumferential Road 3 Missing Link Project (which) will be done later this year,” said Dominguez.
Socioeconomic Planning Secretary Ernesto Pernia said even after the country upgrades to an upper middle income country status, there will still be a two year grace period to help them in funding other projects under the Build, Build, Build.
Pernia said the upgrade may be moved to 2020 due to country’s projected lower economic growth rate this year.
Once the country achieves the upper middle income country status, the Philippines will not be qualified for the Special Terms on Economic Partnership (STEP) funding.
“So we will be on a non-STEP funding but there is a grace period of two years between the time we achieve Upper Middle Income country status and the non-qualification for us (is) to be able to avail of STEP funding. What we have to do now is to prioritize projects such that those are more costly than others. That will be prioritized, We want them to move forward faster than the lesser cost projects,” said Pernia.
He cited the Metro Manila Subway project and the North-South Commuter Railway project as big ticket items.
Pernia said these meetings with the Japanese government are very useful in terms of the pipeline of projects they have indicated for Japanese funding.
“It also opens avenues for discussion on other possible and potentially useful projects. It bears additional fruits besides the one that are usually discussed as pipeline projects,” he said.
After their meeting, the two governments signed the $202.04 million loan agreement for the Road Network Development Project in conflict areas in Mindanao.
This involves the construction, rehabilitation and improvement of a road network with a total length of 176.06 kilometers in the Bangsamoro Autonomous Region in Muslim Mindanao and its neighboring region.
The Duterte administration said by second half of the year, the public can really expect the “best has yet to come” in terms of these big ticket item projects. Ella Dionisio/DMS