The Philippines is set to receive $50 million worth of loan from the World Bank to fund various infrastructure initiatives throughout the country.
The multilateral lender on Thursday inked the financing agreement with state-owned Development Bank of the Philippines, which would facilitate the disbursement of the loan to the Department of Finance and various local government units.
In a statement, the World Bank said it hoped that the financial assistance, which will fund the Regional Infrastructure for Growth Project (RIGP), would allow Filipinos to benefit from the country’s economic gains.
“RIGP is a product of the continuing partnership between and among the World Bank, the Philippine government, and DBP in supporting local government units as they fulfill and balance their mandate as local development managers and providers of basic services,” said Motoo Konishi, World Bank’s country director for the Philippines.
In the same statement, the Development Bank of the Philippines said the poorest of the country’s provinces would be the first to receive the loan disbursements.
The money is going to be used to fund projects that are considered vital by local government officials.
“RIGP will finance a wide array of local public infrastructure and services that will promote physical and economic integration among local government units,” said Francisco del Rosario Jr., Development Bank of the Philippines president.
RIGP projects are expected to complement previous roll-on-roll-off projects that are meant to ease transportation, Del Rosario said.
According to the World Bank, projects that are likely to be financed by the loan include local roads, ports and other transportation facilities.
It will also bankroll the establishment of sea walls, drainage systems, water supply systems, and solid waste facilities.
Also, the fund is expected to support tourism projects, such as the construction of eco parks, heritage sites and convention centers.
Government economic officials believe that the projects are essential for the development of areas outside the National Capital Region. The infrastructure will enable local governments to reduce the incidence of poverty in their respective areas.
Government officials explained that the development projects to be undertaken outside the capital would allow the economic gains of the country to trickle down to the grassroots.
Although the Philippines has been able to sustain economic growth over the years, even during the global recession in 2009, the gains are only said to benefit those in the urban areas.
Economists consider the income gap across regions to be quite significant.