Duterte economic team to negotiate infra projects with AIIB
Economic managers will visit Beijing in January to firm up transportation projects to be funded by the China-led Asian Infrastructure Investment Bank (AIIB) in line with the Duterte administration’s pivot to China, officials said.
On its website, the AIIB said its president Jin Liqun visited Manila last Dec. 12-14, during which he met with President Rodrigo Duterte, Finance Secretary Carlos G. Dominguez III, among other government officials.
“It was a great pleasure to meet President Duterte of the Philippines, the most recent country to ratify the AIIB’s articles of agreement. The bank looks forward to supporting the Philippines in its endeavor to develop world-class infrastructure, including in the transportation sector,” Jin was quoted by the AIIB as saying in a statement.
Last Dec. 5, the Senate voted 20-1 to ratify the Philippines’ membership in the Beijing-headquartered AIIB, ahead of the Dec. 31 deadline for submission of prospective members’ instruments of ratification.
In a speech before members of the Federation of Filipino Chinese Chamber of Commerce and Industry last Dec. 13, Diokno disclosed that during Duterte’s meeting with Jin, they “[fleshed out] major infrastructure projects [that were] shovel-ready and ready for financing by the AIIB.”
“Next month, just before the Chinese New Year, Secretary Dominguez, [Socioeconomic Planning] Secretary [Ernesto M.] Pernia and I will go to Beijing to negotiate specific projects with AIIB,” Diokno said.
The Budget chief said “the new administration understands the importance of improved relations with China.”
“The President’s state visit to China last October, in which many of you joined, promises many positive outcomes. It promises greater trade with China, which right now is already our country’s second-biggest trading partner. It promises to double or triple agricultural exports to China. It promises more than one million Chinese tourists to the Philippines, and it promises fresh infrastructure financing for us,” he added.
READ: Itemized list of PH projects covered by China’s $15-B investment pledges to Duterte
The Department of Finance said early this week that the government was planning to borrow up to $500 million from the AIIB next year to fund ready-to-implement projects.
READ: PH eyes $300M to $500 million from China-led AIIB in 2017
National Treasurer Roberto B. Tan had said membership in the AIIB would allow co-financing with the Manila-based multilateral lender Asian Development Bank of the EDSA bus rapid transit (BRT) project, as well as with the World Bank for the Metro Manila flood control project.
The Philippines had been required to contribute to the AIIB a total of $200 million or about P9.3 billion in paid-in capital, payable in five tranches until 2019. The AIIB’s total capitalization was $100 billion.
The initial tranche of paid-in capital worth $40 million or almost P2 billion will be sourced from budgetary savings and must be remitted before yearend.
The second and third installment payments worth P3.72 billion were already included in the P3.35-trillion 2017 national budget.
The country will have a total voting power of 12,821 votes or 1.1 percent of the total voting power across all members, as well as join the proposed constituency comprised of Bangladesh, Malaysia, Maldives, Nepal and Thailand.
The Duterte administration plans to spend P860.7 billion or 5.4 percent of the gross domestic product (GDP) on hard infrastructure next year, en route to bringing the infrastructure spending-to-GDP ratio to 7.2 percent by 2022.
