The Export-Import Bank of Korea (Korea Eximbank), a state credit agency providing concessional loans and assistance to governments, is earmarking some $500 million in official development assistance (ODA) to the Philippines from 2014 to 2017.
“This (ODA) reflects the enhanced economic cooperation between the (Philippines and Korea). We are considering the needs of the country and then we decide the amount and the priority areas,” said Gimin Kang, senior program officer of Korea Eximbank, on the sidelines of a forum hosted by the Korea International Cooperation Agency and Asian Institute of Management yesterday.
The proposed ODA, however, is still being negotiated by Korea Eximbank and Philippine state agencies, which started the discussions and negotiations for a new framework agreement last month.
Kang said the governments hoped the framework would be concluded and signed within the first quarter of 2014.
If approved, about 70 percent of the concessional loans will be rolled out between 2014 and 2017 for projects that promote sustainable economic growth through transport infrastructure development; support food security and rural poverty alleviation through agriculture and water resources development; and strengthen national health systems and expand access to local health services.
The remaining 30 percent (or about $150 million) will not be allocated for specific projects but will instead be left “open” to be used for any new funding requirements that may arise during the period.
According to Kang, a country program mission was conducted earlier this year to identify specific projects, including those being offered under the government’s public-private partnership (PPP) program, and to discuss the so-called rolling plan for years 2014 to 2017. Among these projects were large scale infrastructure projects involving water resources and agriculture and rural development.
Kang declined, however, to identify the specific projects being eyed.
Government data showed that Korea was the Philippines’ fifth biggest trading partner in 2012.
Bilateral trade between the Philippines and Korea amounted to $7.41 billion in 2012, up 11 percent from the $6.66 billion posted the previous year.
Exports to South Korea rose by 28.6 percent to $2.88 billion last year, making South Korea the sixth top Philippine export market.
Meanwhile, imports from South Korea inched up by 2.49 percent to $4.53 billion in 2012, making South Korea the Philippines’ fifth major import supplier.