DOF, Korean firms ready to fund new airport and other infra projects

The Department of Finance has secured a P13.15-billion loan from the Korean government through the Export-Import Bank of Korea (KEXIM) to fund the Dumaguete Airport Development Project. | PHOTO: Official Facebook page of the Department of Finance

The Department of Finance has secured a P13.15-billion loan from the Korean government through the Export-Import Bank of Korea (KEXIM) which will fund more than three quarters of the new Dumaguete Airport Development Project.

“With the new Dumaguete airport, we anticipate accommodating up to 2.5 million passengers per year, up from just 800,000. From serving limited domestic flights, we can now open the door to international routes,” Finance Secretary Ralph Recto said on Wednesday.

The project has a total cost of P17.06 billion which covers 197.55 hectares of land development in the municipality of Bacong, Negros Oriental. Of the said amount, KEXIM will shoulder P13.15 billion or 77 percent of the total.

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“The necessity for a bigger and more modern airport is undeniable, especially considering that Negros Oriental currently has only one major airport,” he said.

Recto said the government plans to upgrade more regional airports across the country.

Also in the table that was agreed upon was the latest Economic Development Promotion Facility (EDPF) that will fund more infrastructure projects nationwide.

The finance chief noted that the $3-billion new facility will also be used to fund infrastructure projects under the Marcos administration.

The EDPF is a new official development assistance (ODA) loan program of the Korean government to support large-scale infrastructure programs.

Among the projects in the pipeline being considered for possible funding assistance under the new facility are the Panay-Guimaras-Negros Island Bridges, the Consolacion-Liloan Bypass Road Project, the Lapu-Lapu Coastal Road Project, and the Pampanga Integrated Disaster Risk Reduction and Climate Change Adaptation Project Phase II.

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The financing for the airport project has an interest rate of 0.05 percent per year for non-consulting services and 0.0 perce for consulting services. The loan will be repaid in 40 years, with a 10-year grace period.

Meanwhile, the individual financing of projects to be lined up under the EDPF will have an interest rate of 1.2 percent, to be repaid in 25 years and a seven-year grace period.

“The facility we have signed today with South Korea will enable us to deliver more infrastructure projects nationwide, from roads and bridges to disaster risk reduction efforts,” Recto added.