The Philippine government can tap around $3.8 billion in loans and another $21.8 million in the form of non-lending programs from the Asian Development Bank to help fund its accelerated spending for infrastructure and social services, the Finance Department said over the weekend.
A report by the DOF’s International Finance Group said the proposed lending pipeline under the ADB’s Country Operations Business Plan for the Philippines would focus on three priority areas.
It said $1.8 billion or 47.4 percent of the proposed funds would go to infrastructure development, about $1.5 billion or 39.5 percent for education and skills development, access to finance, expanded social protection and employment opportunities for the youth and $500 million or 13.1 percent for programs on good governance and finance.
The COBP will cover the period 2018 to 2020.
“Program loans under the proposed lending pipeline make up 39 percent of the COBP while project loans account for 61 percent,” IFG said in a report to Finance Secretary Carlos Dominguez III at a recent DOF executive committee meeting.
ADB also agreed to explore co-financing arrangements with the Japan International Cooperation Agency on the Philippines’ major infrastructure projects such as the proposed PNR Malolos-Clark Railway and the PNR Commuter South Line project.
The multilateral lender agreed to help the Philippines beef up its capacity and readiness in handling and financing infrastructure projects, particularly on the construction of the country’s railways.
The IFG said the ADB also agreed to the Philippines’ request to hold quarterly meetings to ensure that its country partnership strategy was aligned with the government’s priorities under the Duterte administration.
“The bank has also responded positively to our request to increase the Philippines’ lending envelope and provide more grants and technical assistance,” the IFG said.
The projects covered by the COBP for 2018-2020 include the Central Spine Roll-On/ Roll-Off (RORO) Project and the Mindanao River Basin Flood Control Project.
ADB committed to design a $300-million package of critical transportation infrastructure initiatives to ease Metro Manila traffic and is now exploring the possibility of co-financing the initiative with other multilateral institutions such as the Asian Infrastructure Investment Bank and the Agence Francaise de Development, according to the IFG.