Philippines , ADB ink $500 milion loan for 4Ps

MANILA, Philippines — The Philippines and Asian Development Bank (ADB) have inked a $500-million loan agreement for the provision of education and health assistance to poor Filipino households, according to the Department of Finance (DOF.

In a statement, the DOF said Finance Secretary Carlos Dominguez and ADB country director for the Philippines Kelly Bird signed the loan agreement for the Expanded Social Assistance Project (ESAP) on Monday.

The project aims to assist the government in the implementation of its conditional cash transfer initiative called the Pantawid Pamilyang Pilipino Program (4Ps).

In particular, the DOF said the $500 million loan is intended to fund the provision of education and health grants to eligible 4Ps household- beneficiaries for a period of four years starting 2020.

Dominguez said the financing support would be used to augment the government’s funds for the coronavirus disease 2019 or COVID-19 response efforts.

“We thank the ADB for again extending its support to our sustained efforts to mitigate the impact of the COVID-19 pandemic on our economy and our people. This budget-support loan will not only help bridge our funding gap for our COVID-19 response, but will also strengthen our social protection program as we restart our economy and help people get back on their feet amid the pandemic,” Dominguez said.

According to the DOF, the $500 million financing assistance for ESAP has a maturity period of 29 years, inclusive of an eight-year grace period. Of the total amount, $450 million is expected to be disbursed by next month.

The DOF said this fresh loan brought to $2.6 billion the total financing packages extended by the ADB so far to the Philippines for its programs to address the pandemic.

It also adds to the $6.508 billion financing support the government has secured from multilateral partners and the foreign debt market for its COVID-19 response as of June 5.

On top of the loan, the ADB said it would also provide a $3.1 million technical assistance grant to help the Philippines update the list of 4Ps households, provide livelihood and other support to 3,000 poor households, automate the compliance verification process, and integrate the 4Ps database with the government’s national ID system.