AIIB to continue cofinancing PH infra deals

The Beijing-based Asian Infrastructure Investment Bank (AIIB) will continue cofinancing with other multilateral development banks the Philippines’ ambitious infrastructure development program, its top official said.

“The Philippines has a huge need for basic infrastructure. Given the geography and topography of the country, connectivity within the Philippines is very much important. So we need to ramp up our efforts to build the infrastructure with climate resilience,” AIIB president Jin Liqun told a press conference on Tuesday.

“I’m looking forward to working very closely with [the Philippine] government, with your private sector, and in cooperation with the ADB (Asian Development Bank) and the World Bank and other institutions,” Jin added.

This year, the AIIB cofinanced with the ADB the $700-million second health system enhancement project—dubbed the “HEAL 2”—to address and contain the coronavirus pandemic and help the Philippines procure more vaccines.

The AIIB’s $300-million contribution to HEAL 2 was the first-ever vaccine financing under its COVID-19 crisis recovery facility.

Last year, the AIIB and the ADB also jointly financed the COVID-19 active response and expenditure support (CARES) program, where they chipped in $750 million and $1.5 billion, respectively.

Prepandemic, the Philippines, which became a last-minute AIIB founding-member in 2015 supposedly due to former President Benigno Aquino III’s reluctance over possible Chinese influence in the bank, had only availed of one loan worth $500 million approved in 2017 for the Metro Manila flood management project, which was cofinanced with the World Bank.

The Philippines had also urged the AIIB to cofinance the proposed Metro Rail Transit Line 4 with the ADB, on top of possible financing for two long-span bridges and some water projects.

The AIIB’s lending rates, although still considered “concessional,” were more expensive than the terms applied by the ADB and the World Bank.