INCOMING Finance Secretary Carlos G. Dominguez said the Duterte administration will fast-track the Philippines’ membership in the China-led Asian Infrastructure Investment Bank (AIIB) to widen financing options in line with plans to ramp up infrastructure development.
“The Duterte administration will definitely pursue joining the AIIB as at the forefront of the incoming administration’s socioeconomic agenda is to increase infrastructure spending in the country to 5 percent of the gross domestic product,” Dominguez, through incoming Department of Finance (DOF) spokesperson Paola Alvarez, told the Inquirer.
“With [heavy vehicular] traffic and the lack of basic infrastructure projects being hindrances to Philippine economic prosperity, the membership of the Philippines to the AIIB, an infrastructure-lending bank, is surely something that the people will benefit from,” Dominguez added.
“Together with India, Indonesia, Singapore, Burma (Myanmar), Mongolia, Pakistan, Bangladesh, South Korea, Cambodia as well as Brazil, the United Kingdom, Australia, France, Germany and Spain already being founding members of the AIIB, the Duterte administration sees no reason why Congress would not ratify the Philippines’ membership to the AIIB,” Dominguez said.
On Dec. 31 last year—only a day before the deadline—the Philippines announced that it will become a founding member of the AIIB, which aims to finance developing countries’ infrastructure needs.
The Philippines’ membership, however, remained pending as it was impossible to secure Senate ratification in the remaining days of the 16th Congress ahead of the elections last May. The country still has until yearend to secure Senate approval in order to become a founding member.
“Rest assured, the DOF will do its part to work closely with the bicameral committees involved in studying the benefits the Philippines will acquire by signing as a member to the AIIB,” according to Dominguez.
Over the weekend, the AIIB convened in Beijing the 2016 annual meeting of its board of directors, which last week approved their first four loans amounting a total of $509 million to finance projects in Bangladesh, Indonesia, Pakistan and Tajikistan.
National Treasurer Roberto B. Tan was scheduled to attend the meeting, but only as an observer pending the Philippines’ membership.
To become an AIIB member, the Philippines must shell out $196 million, payable in five years or $39 million (over P1.8 billion) per year, as indicative paid-in capital. Members must pay the initial tranche of their respective contributions before this year ends.