DAVAO CITY — Government-run Development Bank of the Philippines (DBP) has opened a soft loan window for local government units (LGUs) as well as cooperatives in Mindanao for water supply systems and irrigation projects.
Rogelio V. Garcia, one of the DBP’s directors, said they will offer credit at an interest rate of 3.5% to 4% per annum, lower than the usual 6.5% to 7%.
Mr. Garcia, speaking at the official launch of the MinDA Water Supply Program Friday, said the payment period will also be more flexible.
“(The) basic length of the loan term of DBP is between seven to 10 years, but we can, of course, make some extension… depending on the project,” he said.
“The water problem that we have in Mindanao… is a problem from long time ago, but nobody gave attention to it… Depending on the application, we can go as much as what is needed,” said Mr. Garcia, who comes from Mindanao.
The program, an initiative of the Mindanao Development Authority (MinDA) and in partnership with the Department of Interior and Local Government (DILG), is intended as a contributing mechanism for economic development, peace, and poverty reduction, especially in remote areas.
Secretary Emmanuel F. Piñol, MinDA chair, said LGUs and cooperatives can pursue the projects as a business venture to “recover their investments” and help pay for the loan.
Among the first LGUs to express interest in availing of the program is Compostela Valley province, soon to be officially renamed Davao de Oro, which is now finalizing a P300-million bulk water project that will cover three towns.
Mr. Piñol said he has already discussed the project with Governor Jayvee Tyron L. Uy and MinDA provided the provincial government a P500,000 fund from its savings to draft the feasibility and engineering study.
“ComVal is actually looking at a P300-million loan to provide water to Nabunturan (the capital) and two other towns,” said Mr. Piñol during the program launch.
MinDA and the local government are awaiting a resolution from provincial board that will authorize Mr. Uy to sign the deal.
Mr. Piñol said MinDA is also planning to tap foreign and international development agencies for similar funding programs that will help LGUs, especially those in the Bangsamoro Autonomous Region in Muslim Mindanao (BARMM).
Among the water-related projects being eyed for the region are desalination facilities in island communities. — Carmelito Q. Francisco and Maya M. Padillo