Philippines revives infra loan talks with China bank
The Philippines has again reached out to a Chinese state bank to renegotiate earlier withdrawn loan agreements for a big-ticket railway project, according to the Department of Transportation (DOTr).
Transportation Secretary Jaime Bautista said in a recent briefing that the Department of Finance wrote to China Eximbank in December, signaling they were “ready to reopen the discussion for the loans” for the Philippine National Railway (PNR) South Long-Haul Project (Bicol).
The first package of the PNR Bicol project, with a cost of P142 billion, links Banlic, Calamba, to Daraga, Albay, via a 380-kilometer railway.
The PNR Bicol project, along with the Subic-Clark Railway Project (SCRP) and Mindanao Railway Project (MRP), was supposed to be funded by China before the previous administration scrapped the funding plan due to the inaction of the Chinese state bank. Suspended animation
The finance department of former President Rodrigo Duterte had recommended that the loan applications be dropped as they remained in “suspended animation,” Transportation Undersecretary for Railways Cesar Chavez previously explained.
The P50-billion SCRP is a 71.13-km railway system linking Subic Bay Freeport Zone and Clark Freeport Zone. The first phase of MRP, which covers the 102-km Tagum-Davao-Digos route, amounts to P83 billion. In October, Bautista said they were aiming to conclude the renegotiation of the loan facilities with China by the first quarter of 2023.
Most competitive rates
“We really want to make it as early as possible,” he said earlier.
Still, the DOTr chief said the government was open to striking a deal with other countries interested in funding the projects.
Infrawatch PH convener Terry Ridon previously said that the government “should be able to pick and choose the most competitive rates from various funders while ensuring social and environmental commitments with its development partners.”
Ridon added that public-private partnership might be “a viable alternative but only for projects with a clear business case for the private sector to participate, such as tollways, railways and transport hubs in metropolitan areas.” INQ