The Philippines and China have pledged to fast-track the implementation of big-ticket infrastructure projects, including two railways, to be financed by Chinese official development assistance (ODA).
Following the meetings between Philippine economic managers and Chinese officials in Beijing last week, the two sides committed “to speed up the preparation and processes needed to ensure the timely implementation of the Duterte administration’s flagship infrastructure projects with financial support from China,” the Department of Finance said in a statement.
For the part of the Philippine government, Finance Secretary Carlos G. Dominguez III noted during a meeting with Chinese Commerce Minister Zhong Shan last Thursday that an interagency China Projects Task Force, created last April, “has been effective in monitoring and facilitating the preparation and implementation” of projects up for ODA financing from the mainland.
Dominguez added that the Philippines also welcomed the creation of the China International Development Cooperation Agency (Cidca) as one of the reforms announced during China’s 13th National People’s Congress last March.
Cidca is the lead agency directly under China’s State Council made in charge of providing government concessional loan financing, the DOF explained.
Dominguez also told Zhong that an agreement would soon be signed to establish a Chinese-led industrial park at the soon-to-rise New Clark City.
For his part, Zhong assured the [Philippine] delegation that more space would be allocated for Philippine exhibitors at the upcoming China International Import Expo “as a demonstration of China’s commitment to make new progress in the bilateral relations between the two countries,” the DOF said.
Zhong also said that the Chinese Ministry of Commerce was “supportive” of a possible parallel financing arrangement between China and the World Bank for the rehabilitation of the Agus-Pulangi Hydroelectric Power Plants of the state-owned National Power Corp. (Napocor), the DOF added.
In a separate meeting last Wednesday with China’s State Councilor and Foreign Affairs Minister Wang Yi, Dominguez said that the preparation for the Manila-Bicol Railway and Clark-Subic railway projects “have already been moving quite fast ahead.”
Currently under negotiations for loans from China were the the Department of Transportation’s P175.3-billion North-South Railway Project-South Line (Long Haul) as well as the Bases Conversion and Development Authority’s P57.2-billion Subic-Clark Railway Project.
Dominguez told the Chinese officials that the Philippines “already received a lot of investments from your country as well as tourists have been coming in from China.”
The DOF said that net foreign direct investment from China as of May already exceeded by 534 percent the net investments of Chinese investors for the entire 2017.
Meanwhile, approved investment commitments from the Chinese climbed 57.14 during the first five months, the DOF added.
According to the DOF, bilateral trade with China has also increased since 2017, with total trade between the two countries reaching $13.9 billion in the first half of 2018.
China is now actually the largest trading partner of the Philippines. We expect this growth trend to be sustained, Dominguez said.
Also, the number of Chinese tourists entering the Philippines hit almost one million in 2017 and the Philippines’ target for 2018 is to bring in 1.5 million tourists from China, according to the DOF.
Dominguez noted that the closer economic ties between Manila and Beijing came about when President Duterte assumed office.