ADB funding $11B of PHL projects from 2020-2022

THE Philippines may secure nearly $11 billion in financing from the Asian Development Bank (ADB) in the last three years of the Duterte administration.

Based on the Country Operations Business Plan 2020-2022, ADB’s lending and nonlending program for the Philippines could reach $10.67 billion or P554.89 billion between 2020 and 2022.

The amount includes financing for firm and standby pipeline of projects to be funded by lending, as well as various forms of technical assistance to be extended in the next three years.

“The Philippine government needs demand-driven knowledge support in [i] preparing lending operations, [ii] drawing lessons for future investments from the monitoring and evaluation of operations, [iii] optimizing policy and capacity development, and [iv] obtaining inputs for the next Philippine Development Plan [20232028],” the plan said.

“In response to government’s knowledge needs, ADB and the government have established a knowledge partnership to develop an annual two-year rolling knowledge plan that supplements the country operations business plan,” it added.

On top of the projects solely intended for the Philippines, the ADB has also included the country in 16

regional technical assistance projects which are expected to amount to $60.5 million in the next three years.

However, the ADB is only expected to shoulder around $39.5 million of the amount, while the rest will be sourced from various regional funds such as the Japan Fund for Poverty Reduction (JFPR) that the ADB administers.

$4.37B in 2020

MEANWHILE, based on the Philippine pipeline, the largest ADB loan and grant assistance will be extended to the Philippines next year worth $4.37 billion.

This covers eight projects in the firm pipeline and three in the standby pipeline, as well as three transaction technical assistance projects.

ADB will extend $3.5 billion for the eight projects in the firm pipeline. This is only a portion of the $3.77 billion worth of projects to be financed next year, some to be financed through cofinancing with other institutions.

The largest loans to be extended by the ADB are the $1.2 billion for the South Commuter Railway Project (PFR1); the $500-million Integrated Flood Risk Management Sector Project; and the $500-million Expanded Social Assistance Project.

The standby pipeline for 2020 includes three projects, the $500-million Metro Rail Transit, Line 4 Project; $300-million Support to Universal Health Coverage Project (RBL); and $70-million Davao Public Transport Modernization Project.

The three technical assistance projects are the Poverty Reduction in Communities Affected by the South Commuter Railway Project; South Commuter Railway Project Implementation Support; and Strengthening Infrastructure Capacity and Innovation for Inclusive Growth (supplementary).

ADB will only shoulder $1 million for the Strengthening Infrastructure Capacity and Innovation for Inclusive Growth project while the two other technical assistance projects worth $4 million will be financed through the JFPR.

The pipeline of technical assistance projects for 2021 and 2022 has yet to be determined by the ADB and the Philippine government.

OCR lending

MEANWHILE, for 2021, ADB will finance $3.7 billion in lending through its ordinary capital resources (OCR).

This is only a portion of the $3.77 billion worth of projects to be funded next year, some through cofinancing.

The largest projects to be financed through OCR lending are $1 billion for the Malolos–Clark Railway Project (PFR2) and $500 million each for the Metro Rail Transit, Line 4 Project, Laguna Lakeshore Road Transport Project and Bataan–Cavite Bridge Project.

On standby is the Mindanao Agro-Enterprise Development Project, where ADB will extend a $100-million loan.

For 2022, ADB will fund $2.6 billion worth of projects, including $2 billion in the firm pipeline and $600 million in the standby pipeline.

The largest projects in the firm pipeline are the $850 million South Commuter Railway Project (PFR2) and $450 million Malolos–Clark Railway Project (PFR3).

Projects in the standby pipeline are the $500 million Clark–New Clark City Railway Project and the $100-million Integrating Innovation System in Philippine Technical Vocational Education and Training Project.

For 2019, the ADB is providing $2.98-billion loans through its OCR. This forms the big chunk of the project cost for the year of $6.54 billion.

ADB said $2.18 billion of the total project cost will be financed through cofinancing and the remaining $1.38 billion, in government counterpart funding.

The largest project being financed this year is Phase 1 of the Malolos–Clark Railway Project worth $4.69 billion.

ADB will extend $1.3 billion for this project; $2 billion will come from cofinancing and $1.38 billion from the national government.

In terms of its nonlending operations, the ADB is extending a total of $11 million for 14 technical assistance projects.

This is only a portion of the $19.83 million worth of technical assistance the country will get in 2019 through the ADB. The other $8.83 million will come from other funds such as the JFPR and the Urban Climate Change Resilience Trust Fund. The largest of these is the Strengthening Infrastructure Capacity and Innovation for Inclusive Growth, to be exclusively funded by the ADB at $4 million.Cai U. Ordinario