Phl, Japan sign $100-M loan deal

MANILA, Philippines - The Philippines and Japan signed last week a $100-million loan agreement, the Department of Finance (DOF) said over the weekend.

The loan agreement, signed on the sidelines of the World Bank-International Monetary Fund Annual Meeting in Tokyo, Japan last week, will support the implementation of the Development Policy Support Program-Investment Climate Program (DPSP-IC) Loan.

Finance Secretary Cesar Purisima and Japan International Cooperation Agency (JICA) president Akihiro Tanaka signed the loan agreement.

In a statement, the Finance department said the DPSP-IC aims to help the Philippines strengthen domestic policy for the promotion of competitiveness and inclusive growth in three areas: employment facilitation, improving competitiveness and the creation of an enabling environment for public-private partnership (PPP) infrastructure.

The program loan is co-financed with the Asian Development Bank. It is a budgetary support financing which supports the achievements of the government covering the implementation of policy reforms for the improvement of the country’s investment climate.

The loan carries an interest rate of 1.4 percent per annum, with 30 years inclusive of 10 years grace period.

Data from the Finance department showed that the total amount of budgetary support funds when combined with the Asian Development Bank’s $350 million program loan totals about $450 million.

Japan has been consistently the Philippines’ top source of official development assistance (ODA).

JICA presently supports the loan and grant aid financing totaling to about JPY250 billion primarily in the sectors of agriculture and agrarian reform, infrastructure, flood control, environment, climate change, Mindanao peace process, disaster risk reduction and management, and human resource development, the Finance department also said.