The Philippines became the first recipient of Japan’s emergency support loan for COVID-19 affected economies, with the early disbursement on Aug. 14, 2020 of its 50-billion-yen financing package to the Duterte administration, according to the Department of Finance.
It said the loan aimed to assist the government’s efforts to contain the spread of the coronavirus pandemic and provide economic relief to Filipinos affected by the global health crisis.
Finance Secretary Carlos Dominguez III thanked the Japanese government for disbursing the financing package in a record period of 44 days after the signing of the agreement on July 1.
The financing package carries concessional lending terms of 0.01 percent (one hundredth of a percent) fixed interest rate per annum with a maturity period of 15 years inclusive of a 4-year grace period.
“We thank Tokyo and JICA for the release in record time of this emergency support loan for the Duterte administration’s COVID response that has made the Philippines the first recipient of Japan’s assistance program for economies battered by the coronavirus-induced global health and economic crisis,” Dominguez said in a statement.
“This underscores the strong partnership between Japan and the Philippines under the Duterte presidency and the top priority that the Japanese government has given to our country as its development partner, especially at this time of the COVID-19 pandemic,” he said.
The package became effective Aug. 11 and was quickly disbursed by the Japanese government through the Japan International Cooperation Agency after three days.
Dominguez said that despite the restrictions resulting from the quarantines imposed to curb the spread of COVID-19, officials of both countries were able to speed up the process of making the loan effective and ready for disbursement.
Given the Philippines’ urgent need for budgetary support to address the COVID-19 emergency, it took less than a month to secure all the documents necessary for the declaration of the effectiveness of the 50-billion-yen financing package.
This is the quickest loan that was secured under Japan’s official development assistance financing package and in keeping with the “fast and sure” approach adopted by the two countries since 2017.
This was approved by the interagency Development Budget Coordination Committee on June 10 and was processed by the approving authorities of both countries in only 14 working days until the July 1 signing of the loan accord.
Dominguez said the loan was important in helping the government cover its budget expenditures through additional borrowings to beat the pandemic and fund its economic recovery program.