The country has signed a loan agreement worth about P8 billion with Japan for the purchase of maritime vessels and improvement of the Philippines’ coast monitoring capability.
In a statement, the Department of Finance reported that the loan worth Y18.73 billion or P7.94 billion to be extended by the Japanese government, through the Japan International Cooperation Agency (Jica), would be turned over to the Philippine Coast Guard (PCG).
PCG, an attached unit of the Department of Transportation and Communication (DOTC), is tasked to use the money for the purchase of 10 maritime vessels, which will enhance the country’s capability to monitor its territories and undertake rescue operations.
“As the nation experiences disasters, both natural and man-made, that have had adverse impact on the welfare of our citizens, the capability and capacity of the DOTC-PCG to quickly respond to such disasters cannot be more magnified,” Finance Secretary Cesar Purisima said in the statement.
Purisima added that the signing of the loan agreement was part of the Philippine government’s efforts to improve the country’s resiliency to calamities.
The DOF said it was prudent for the Philippines to secure loans from Jica, noting that the financing was highly concessional in that it carries very low interest rate and long-term maturity.
Concessional loans carry interest rates of less than one percent and are payable in 20 to 40 years.
The inking of the loan agreement between the Philippines and Japan also in the wake of the two countries’ territorial conflict with China.
China and the Philippines both claim territorial rights over the oil rich West Philippine Sea (South China Sea). China was recently reported to have refused to participate in the arbitration process led by the United Nations over the dispute.
Japan and China also have their own territorial dispute, particularly that involving the East China Sea.
In the meantime, Philippine economic officials also reported that Japan, also through the Jica, had offered a $500-million funding support to the Philippines for reconstruction activities in areas hit last month by Supertyphoon “Yolanda.”