The Philippine government is targeting to secure at least 10 loan financing deals with China when Chinese President Xi Jinping visits in November, Budget Secretary Benjamin Diokno said Wednesday.
The loans will be used to fund 10 big ticket infrastructure projects under the Duterte administration’s Build, Build, Build progam.
“At least 10 siguro ... These are all 10 loan agreements to be signed for projects,” Budget Secretary Benjamin Diokno told reporters in a breakfast forum in Manila.
“The agencies are reserving it for November during President's Xi’s visit ... After Papua New Guinea, he will pass by Philippines,” the Budget chief said.
In April, presidential spokesman Harry Roque said Xi will visit the Philippines after the Asia Pacific Economic Cooperation (APEC) meeting in Papu New Guinea in November.
Among the projects to be signed are the following:
- New Centennial Water Source-Kaliwa Dam, valued at P12.2 billion or $228.25 million. The project involves the construction of a dam and conveyance tunnel that will provide an additional 60 million liters of raw water to ensure water security in Metro Manila and Rizal.
- North-South Railway-South Line (Long Haul), amounting to P175.3 billion or $3.279 billion. The project involves the construction and subsequent maintenance and operation of a 581-kilometer standard-gauge long-haul from Los Baños to Matnog and a branch line from Calamba to Batangas.
- Safe Philippines Phase 1, worth P20.313 billion or $380.05 million. It involves the construction of an integrated command center for the 911 public safety answering point, 18 city-level command centers in Metro Manila and Davao, video surveillance system linked via a dedicated communications infrastructure, and data center with a remote data backup center.
- Subic-Clark Railway, worth P57.163 billion or $1.069 billion. The project involves the construction of a 65-kilometer rail traversing through the right-of-way Subic-Clark-Tarlac Expressway and Subic Freeport Expressway.
During President Rodrigo Duterte’s visit to Beijing in 2016, China has committed to provide $9 billion in loans for Philippine infrastructure projects.
The Chinese grant-funded Binondo-Intramuros and Estrella Pantaleon bridges, worth P5.974 billion or $111.77 million, started construction on June 17, 2018.
Other projects slated for China’s loan financing are still confidential and cannot yet be disclosed to the public, according to the Department of Budget and Management.
The loan agreements for construction of five bridges across the Pasig-Marikina rivers, amounting to P13.635 billion or $262.34 million, and the Ambal-Simuay River and Rio Grande de Mindanao Flood Control projects are targeted to be signed in June 2019.
During high-level meetings between the Philippines and China in Beijing last week, both parties gave assurance towards mutual commitment to speed up the processing and implementation of China-financed infrastructure projects, Diokno said.
“We met with our counterparts to strengthen economic cooperation and provide updates on our Build, Build, Build program,” he said.
“We also like to assure the public that the Philippines is exercising due diligence in processing the approval of these projects. These projects are scrutinized by various national government agencies and inter-agency commitments, requiring feasibility studies, detailed engineering designs, cost-benefit analysis—including their environmental and social impacts, financial analysis of interest rates and budgetary impact.”
The projects also go through the Investment Coordination Committee and the National Economic and Development Authority Board, chaired by President Rodrigo Duterte.
Diokno reiterated that the Philippines will not fall into a “debt trap” with China as the country has a healthy fiscal position with a debt-to-gross domestic product ratio of 42 percent in 2017. The ratio is expected to decline further to 39 percent in 2022.
The government follows a threshold of 10 percent rate of return on loan-financed projects. —VDS, GMA News