THE PHILIPPINES is set to sign an agreement with South Korea for loans and grants on the sidelines of the 31st Association of Southeast Asian Nations (ASEAN) Summit here next week.
In a statement, the Department of Finance (DoF) said that South Korea has offered a $1.7-billion credit facility to the government, as well as a $7-million fund to support the transport, information and communications technology, and energy sectors.
The aid will be tapped from the Export-Import Bank of Korea (KEXIM), which manages its Economic Development Cooperation Fund, an official development assistance (ODA) facility.
“Among the financial tools that the Philippines can tap from South Korea is a $100-million credit line for a Project Preparation Facility, which is available at zero interest and payable in 40 years (inclusive of a 10-year grace period),” the DoF said.
The facility will assist in the government’s pre-investment activities, including project preparation, and feasibility studies and planning.
The DoF also said that the Department of Public Works and Highways (DPWH) and the National Irrigation Administration (NIA) can utilize the Project Preparation Facility.
“The KEXIM credit line can also be tapped via a tied loan facility with South Korean companies entering into joint ventures with Philippine firms,” it added.
Aside from the NIA and DPWH, the other agencies with identified projects in the pipeline for the KEXIM loan facility are the Department of Information and Communications Technology (DICT), Department of Agriculture (DA), Department of Transportation (DoTr) and the National Electrification Administration (NEA), according to the DoF.
The government has lined up possible projects to tap the loan program, which include: the EDSA line of the Metro Manila Bus Rapid Transit, the Development of Marine Aids to Navigation in Luzon and Visayas, the New Dumaguete Airport Development Project, the development of Hybrid Power Generation Systems in the Philippines, the Mindoro Multi-Grain Processing Center, Development of the National Animal Identification and Traceability System, Drive-through Portal inspection Facilities at International Ports of Entry, and the Automated Collection of Slaughter Data and Issuance of Meat Inspection Certificates
The government has approved the P9-billion New Cebu International Container Port project funded by South Korean ODA. — Elijah Joseph C. Tubayan