By Elijah Joseph C. Tubayan
THE GOVERNMENT will sell an initial P13.5 billion worth of retail bonds to domestic investors to help finance reconstruction and rehabilitation of Marawi City, the Department of Finance (DoF) said in a statement on Tuesday.
The DoF said funds to be raised will cover the P10 billion allocated this year under the national budget for the Bangon Marawi Comprehensive Rehabilitation and Recovery Program (BMCRRP) and another P3.5 billion for 2019.
The DoF said that the succeeding Marawi bond offers would depend on financing requirements.
“As we need money later on, we will issue more bonds,” Finance Secretary Carlos G. Dominguez III was quoted as saying.
Besides the P13.5-billion ($241-million) first tranche of Marawi bonds and the P10 billion ($200 million) budget allocation this year, the estimated $541-million total funding for projects under the Bangon Marawi program includes $100 million (P5.44 billion) worth of an Asian Development Bank emergency assistance loan.
The DoF also cited a funding gap of $64 million, which may be raised through a pledging session with development partners “sometime in November.”
Japan has already committed to provide financing support for the rehabilitation program, after inking a ¥2-billion grant agreement, while the United States, Spain, Australia, and the World Bank, have expressed interest.
Asked for details, Finance Assistant Secretary Antonio Joselito G. Lambino II said via text: “The Bureau of the Treasury is working closely with the Bangon Marawi Task Force on several fronts, including approval for the overall rehabilitation plan, securing commitments from our ODA (official development assistance) partners, and an information campaign to enjoin everyone’s support for this endeavor.”
“In terms of tenor, we are looking at three to five years to match the implementation period. The rate will take into account market conditions and the date of issue is forthcoming.”
Asked whether the retail bonds could be sold within the year, National Treasurer Rosalia V. De Leon told reporters separately after the auction of government securities yesterday: “We are looking at that horizon, but we cannot… really exactly tell.”
She also noted that overseas Filipinos can participate in the Marawi bond offer through the bond online system.
The DoF has said that the Marawi bond offer may total to P40-60 billion in a span of five years.
Marawi city was devastated after a five-month battle between government forces and Islamic State-inspired militants that ended in October last year.
The DoF also noted that the World Bank plans to pool contributions from other development partners into a proposed Bangon Marawi Multi-Donor Trust Fund.
The government has asked the Washington-based multilateral lender to set up a Project Monitoring Unit under the Task Force Bangon Marawi to monitor the status of programs and projects identified in the BMCRRP.
The Finance department noted that it will also convene a follow-up interagency technical working group meeting to finalize the list of projects under the BMCRRP and to identify policy and implementation concerns.