The loans and grants secured by the Philippines to finance its COVID-19 response climbed to $6.51 billion (more than P325 billion) to date after it signed a $750-million loan agreement with the Beijing-based Asian Infrastructure Bank (AIIB).
In a statement Tuesday, the Department of Finance (DOF) said Secretary Carlos G. Dominguez III and AIIB acting director-general Rajat Misra on Friday last week signed the loan accord for the China-led multilateral lender’s share in its co-financing with the Asian Development Bank (ADB) of the Philippines’ $2.25-billion COVID-19 active response and expenditure support (Cares) program.
The AIIB loan maturing in 12 years (inclusive of a three-year grace period) will be fully disbursed within this month, the DOF said.
“The loan package from the AIIB will help augment our funding requirements necessary to mitigate the severe negative impact of COVID-19 on our people and our economy. On behalf of the Philippine government, we thank the AIIB and [its] president Jin Liqun for committing with the ADB to support the Cares program, which will go a long way in helping our people get back on their feet, and our economy recover and emerge stronger after the crisis,” Dominguez said.Prior to last week, the DOF said it had borrowed $5.65 billion for budgetary support in the fight against COVID-19, on top of $8 million in grants and one project loan also aimed at addressing the pandemic’s health and socioeconomic fallout.
Among the loans secured as budgetary support financing were the Manila-based ADB’s counterpart $1.5 billion for the Cares program, $200-million social protection support project (second additional financing) and $400-million support to capital market-generated infrastructure financing (subprogram 1).
Also among the budgetary support loans were the Washington-based World Bank’s $500-million third disaster risk management development policy loan, $500-million emergency COVID-19 response development policy loan and $200 million from its social welfare development and reform project 2 (additional financing) secured last year but was realigned for COVID-19 response.
The Philippines’ $2.35 billion in US dollar-denominated global bonds, which fetched record-low coupons across two tenors when sold last April, will also be used for COVID-19 budgetary requirements. —BEN O. DE VERA INQ