ODA earmarked for infra projects

The bigger official development assistance (ODA) commitments attracted by the Duterte administration thus far will mostly be spent in infrastructure to sustain economic growth and slash poverty incidence, the country’s chief economist said.

Socioeconomic Planning Secretary Ernesto M. Pernia noted that ODA have advantages such as very low interest rates of less than 2 percent on the average, as well as long grace periods of about 25-40 years.

But ODA as a funding source also have disadvantages, such as typically slow processing and also procurement, said Pernia, who is also the head of state planning agency National Economic and Development Authority.

But with greater competition among fund sources, processing speed may pick up,” he said.

The Duterte administration’s 10-point socioeconomic agenda aims to slash the poverty incidence to 14 percent by 2022 from 21.6 percent last year.

This year, the Duterte administration plans to spend P860.7 billion or 5.4 percent of the gross domestic product (GDP) on hard infrastructure, en route to bringing the infrastructure spending-to-GDP ratio to 7.2 percent by 2022.

Last Sunday, the government reported that the Duterte administration already attracted close to P1 trillion in ODA from economic giants China and Japan in its first seven months in office. BEN O. DE VERA