Standard Chartered wants to participate in Mindanao railway, DBP revamp
STANDARD Chartered PLC wants to participate in the government’s infrastructure program, offering to finance a railway project and helping revamp the Development Bank of the Philippines (DBP), the Department of Finance (DoF) said yesterday.
Standard Chartered, a British bank focused on emerging markets, met with the DoF leadership recently to discuss plans to convert the DBP into an infrastructure-focused bank.
“There are five projects approved by the National Economic and Development Authority, and the largest is the railway in Mindanao. We want to see how we can help there,” said Lynette V. Ortiz, the bank’s Philippine CEO and Country Head, in a meeting with Finance Secretary Carlos G. Dominguez III.
The Mindanao railway is an 830-kilometer loop connecting key cities like Butuan, Nabunturan in Compostela Valley, Davao City, Cotabato City, Iligan, and Cagayan de Oro.
The first phase, the P35.26- billion Tagum-Davao-Digos link, is set to be approved by the President next week, and is expected to start construction next year.
“We also want to clarify how we can help closely DBP as an infra bank — putting up an infra fund, or providing advisory [services],” she added.
Mr. Dominguez welcomed the proposal, saying: “We’d really like to partner with you on this. [ DBP president and CEO] Cecille [Borromeo] will welcome working with you, especially with your experience in Asia.”
The infrastructure bank is expected to strengthen funding support for the government’s planned P8.4 trillion medium term infrastructure spending plan.
Mr. Dominguez said earlier that he intends the transition to take place before the end of 2017.
Moreover, Mr. Dominguez reiterated that the government’s new approach to fast-tracking infrastructure projects is to bring in private concessionaires later in the project, while launching them with internal funding.
“The whole idea is we believe we’re so far behind our neighbors on infrastructure, and it just makes sense to spend money on it. But we’re not going do it like how they did it in the past. Doing it through PPP ( Public- Private Partnership) takes so much time. Our administration is willing to start the projects, and outsource the operations and maintenance later. It will allow people who are averse to take the construction risks to come in,” he said.
Aside from the infrastructure plan, the officials also discussed the Philippines’ plan to sell Panda bonds denominated in China’s currency this year, and the possibility of offering green bonds and project bonds, also to support the infrastructure buildup.
The public infrastructure drive is part of the government’s effort to achieve growth of 7-8% next year until 2022 from 6.9% in 2016. —