PHL, ADB mark 56 years tie up with single largest infra financing of $4.3B for SCRP
THE Philippines and the Asian Development Bank (ADB) marked their 56 years of productive partnership with the signing of the first tranche of the multilateral institution’s largest single infrastructure loan package—the $4.3-billion funding support for the South Commuter Railway Project (SCRP)—ONE of the flagship ventures under President Duterte’s centerpiece infrastructure development program “Build, Build, Build.”
Duterte witnessed the signing by Finance Secretary Carlos Dominguez III and ADB President Masatsugu Asakawa of the agreement for the first tranche of the loan amounting to $1.75 billion in ceremonies at Malacañang Palace on Thursday night, June 16.
Dominguez said ADB’S high level of approved financing to the Philippines— totaling over $30 billion since 1969, more than half of which was released under the Duterte administration—is “a vote of confidence for President Duterte’s economic development agenda and fiscal management.”
This vote of confidence is also reinforced by the fact that in the last six years, other Adb-supported projects in the country have attracted from various partner institutions a total of $8.7 billion in co-financing, which represents 74 percent of the total sovereign co-financing from 1972 to 2022, Dominguez said.
The Japan International Cooperation Agency (JICA), which has extended $4.5 billion to ADB’S projects in the Philippines since 2017, is the largest of these cofinancing partners.
Under the Duterte administration, the Philippines-adb portfolio was also rebalanced to closely align with the priorities set by the Philippine government, such as the “Build, Build, Build” program and Duterte’s ambitious climate action agenda, which led the Bank to extend its first-ever climate change policy-based loan to the country, Dominguez said.
The Bank has also provided technical assistance to the government for the design of various projects, Dominguez noted.
“At every turn, it was the Duterte administration’s priorities that drove the ADB’S development assistance agenda for the Philippines,” Dominguez noted.
Dominguez reminded the ADB that being the region’s largest and most experienced development institution, “it needs to step up again to assist its members” and become a “more agile and flexible” instrument in responding to their needs, now that the recovery efforts of the Philippines and other pandemic-battered Asia Pacific economies are being weighed down by the impact of the conflict in Ukraine.
He thanked the institution for being the Philippines’ most reliable multilateral development partner, and expressed confidence “that our successors will continue the same close collaboration with the ADB –– a longstanding partnership that has been mutually beneficial to the Filipino people and to the institution.”
The ADB will extend the $4.3-billion financing package for the SCRP, which has a total estimated project cost of $8.07 billion through a multi-tranche facility.
JICA is co-financing the SCRP through a $1.67 billion loan, with the Philippine government covering the rest of the balance of the project cost.
Another $1.75 billion loan is expected to be provided by the ADB in 2024, representing the second tranche of the financing package.
The final tranche of $800 million for this project is scheduled to be given in 2026.
The SCRP will bring much-needed relief to thousands of Filipinos traveling between Manila and Calamba along with several nearby towns in Laguna as this is expected to cut travel time between the two points from about two hours by bus to less than an hour by rail.