AIIB commits funds for PH infra
China-led Asian Infrastructure Investment Bank (AIIB) has committed to fast-track the approval of two Philippine infrastructure projects to be pitched for co-financing with other multilateral lenders.
In a statement Monday, the Department of Finance quoted AIIB president Jin Liqun as telling Finance Secretary Carlos G. Dominguez III during a meeting last week that they were “very eager to finalize the infrastructure projects in your country.”
Jin also reportedly confirmed that the first two projects that the AIIB will co-finance in the Philippines with other multilateral lending institutions are the Metro Manila flood management project and the Edsa bus rapid transit (BRT) system.
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.
Earlier, President Duterte on Oct. 19 signed the instrument of ratification of the AIIB.
For his part, Dominguez said he had been strongly backing the Philippines’ AIIB membership, which would give the government “another source of long-term funding at very reasonable interest rates.”
“Achieving full membership in the AIIB is a significant milestone.
Completing our domestic procedures for ratification puts us in solidarity with 56 other countries,” according to Dominguez.
Jin said the AIIB’s thrust was infrastructure financing because the Beijing-headquartered bank deems that “poverty reduction is the derivative of economic development.”
“This is our difference. We may finance other productive sectors, not just infrastructure. [That includes] industrialization, manufacturing because we believe developing countries need to move up on the value chain. And if you help them, then you can help them to be able to generate income,” according to Jin.
As such, Jin was quoted by the DOF as saying that the AIIB offers not only faster project approvals but also cheaper financing terms.
“Compared to ADB and World Bank, it will take less than half a year in AIIB to process loans,” Jin said, adding that the lender also extends technical assistance to less developed nations.
On its website, the AIIB said Jin visited Manila last Dec. 12 to 14, during which he also met with President Duterte, 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.
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.
