THE GOVERNMENT is now drawing up an initial list of major projects to be submitted to the Asian Infrastructure Investment Bank (AIIB) following Philippine ratification last week of its membership in the China-led new regional lender, the Finance department said in a statement yesterday.
The statement quoted National Treasurer Roberto B. Tan as saying that the government is preparing for an AIIB mission that will discuss the Philippines’ list, citing the EDSA Bus Rapid Transit and the Metro Manila flood control projects as “among the first to be presented… for possible funding.”
“These are the projects that are the most prepared in terms of government approvals, feasibility studies and other requirements and are already in the pipeline,” Mr. Tan explained.
“To expedite financing from the bank, we are proposing projects which are in the last stage of preparation, and therefore would require less time for AIIB to process,” he said separately by phone.
The board of the National Economic and Development Authority (NEDA), led by President Rodrigo R. Duterte, approved both projects last Sept. 14 for implementation.
The P37.8-billion Metro Manila Bus Rapid Transit-EDSA project — which will take three years to implement and which should be operational in 2020 — will be designed to help ease Metro Manila’s traffic. The BRT system will run for 48.6 kilometers along EDSA between the Monumento area in Caloocan City and Diosdado Macapagal Avenue/Roxas Boulevard, with integrated routes linking Ortigas Business District, Bonifacio Global City and the Makati Business District. The system, which will have up to 63 stations, will also link with terminals of the Ninoy Aquino International Airport and the Integrated Transport System terminals in the north, south and southwest points of Metro Manila.
The P23.5-billion first phase of the Metro Manila Flood Management Project — which will take six years to build — includes the rehabilitation of 36 pumping stations in the cities of Manila, Pasay, Taguig, Makati and Malabon, as well as construction of 20 new pumping stations in Manila, Pasay, Pasig, Mandaluyong, San Juan, Caloocan, Valenzuela and Quezon City.
The Senate last Dec. 5 ratified AIIB’s Articles of Agreement, formalizing the Philippines’ entry as a founding member.
Mr. Tan said the Philippines is “looking at $300-500 million” in AIIB loans “for the initial year” of membership.
The same statement quoted Finance Secretary Carlos G. Dominguez III as noting that the BRT is also supported by the Asian Development Bank, while the Metro Manila flood control project is backed by the World Bank.
He said AIIB membership will provide the Philippines “another source of long-term funding at very reasonable interest rates” as the Duterte administration ramps up infrastructure spending in a bid to sustain faster economic growth that, in turn, will help lift more Filipinos out of poverty by the time the government steps down in 2022.
“AIIB serves as the only multilateral development bank that focuses on infrastructure,” Mr. Dominguez said.
“The operations and policies of the bank are designed to be lean, clean and green. It is committed to principles of transparency, independence, openness and accountability.”
Mr. Tan said that “[f]unds from AIIB will serve as an additional source of concessional financing to support our growing infrastructure requirements”, noting that “[i]ts terms and conditions are comparable to those of other multilateral development banks.”
As a founding member, the Philippines has to contribute to the AIIB within five years some $196 million in total paid-in capital. Mr. Tan added the government is preparing to remit around P1.9-2 billion in initial payment by yearend. “We’re working on releasing the payment this year,” he said.
AIIB currently has 57 member countries — of which 37 are from Asia, while 20 belong to other regions — and $100-billion total capitalization.
13 December 2016
By E. J. C. Tubayan