MANILA, Philippines—Foreign loans and grants spent by the Philippine government on COVID-19 response have already reached more than $10 billion (P509 billion), according to Finance Secretary Carlos G. Dominguez III.
“Fighting the pandemic is costly, as you very well know,” Dominguez said at the online Philippines-Japan Business Investment Forum 2020 on Tuesday (Dec. 1).
In his presentation, Dominguez said the Philippines secured $3.8 billion in loans from Asian Development Bank and these other sources:
- $1.78 billion from World Bank
- $750 million from the China-led Asian Infrastructure Investment Bank
- $917.9 million from Japan International Cooperation Agency
- $275.7 million from Agence Francaise de Developpement, the aid agency of France
- $100 million from Export Import Bank of Korea
Aside from direct loans from lenders, another $2.53 billion was raised through the issuance of US dollar-denominated bonds in two tenors, or maturity periods, last May.
Proceeds from the loans and commercial borrowings were for budget support for COVID-19 response.
Last November, the Philippines also borrowed $615 million for COVID-19 projects.
Grants of $26.36 million had been given to the Philippines for projects to fight the pandemic.
“This year, we expect to collect less in taxes even as we increase spending in health care and relief measures,” Dominguez said.
“The borrowings we have secured at concessional rates will help cover our revenue shortfall,” Dominguez added.
Dominguez told Japanese investors that “the people and government of Japan have been very generous at providing much-needed support for the Philippines.”
On top of the financial assistance in the fight against COVID-19, Dominguez also acknowledged Japan’s help in rolling-out the Duterte administration’s ambitious “Build, Build, Build” program.
“Our infrastructure program is a sound strategy strongly supported by our development partners, especially Japan, through soft project loans and official development assistance,” said the head of the Duterte economic team.
Dominguez said that “with our enduring financial strength, we will meet these obligations.”
Dominguez earlier acknowledged that repaying these massive borrowings could require higher taxes in the future and possibly selling government assets, like mining sites and contracts, and selling gaming operations to the private sector.