The Philippines and the Asian Development Bank (ADB) have signed three loan agreements worth a combined total of US$623.3 million for programs that aim to enhance the Duterte administration’s capability to implement its “Build, Build, Build” projects, gear up the country’s young workforce for quality jobs, and promote free and fair competition in business.
These three loan packages are the US$400 million Facilitating Youth School-to-Work Transition Program, Subprogram 2; US$23.3 million Capacity Building to Foster Competition Project; and the US$200 million additional financing for the Infrastructure Preparation and Innovation Facility.
Signing the accords on Friday (Dec. 13) were Finance Secretary Carlos Dominguez III and ADB Vice President Ahmed Saeed.
These three loan agreements are part of the US$10.3 billion in financing support that the ADB has committed to provide the Philippines over the medium term.
Of this US$10.3 billion total, the ADB has proposed loan financing of US$2.5 billion this year and US$7.8 billion over the 2020-2021 period. From 2009 to 2019, the ADB’s loan financing to the Philippines amounted to US$7.2 billion.
Vice President Saeed said the US$2.5 billion of new loan assistance to the Philippines in 2019 “is our highest lending program ever and reflects ADB’s strong commitment to scaling up our support to the Philippines and its development agenda.”
Secretary Dominguez said this proposed substantial increase in ADB’s loan financing for the Philippines underscores the multilateral institution’s strong support for the Duterte administration’s comprehensive development strategy, which is anchored on aggressive state spending on infrastructure and human capital, disaster preparedness, tourism, health care and agriculture.
“Let me take this occasion again to thank the ADB for its confidence in our government’s capacity to bring forth bold reforms and undertake ambitious development projects. We will do our utmost not to disappoint your best expectations,” Secretary Dominguez said after the signing of the loan agreements.
Vice President Saeed expressed the hope that the three projects formalized through the signing of the loan accords “will help bring an even closer ADB–Philippines partnership in the years to come.”
Secretary Dominguez assured the ADB that the funding support it has provided the Philippines “will be used most efficiently to help realize the Duterte administration’s comprehensive development strategy.”
The Philippines, he said, is at a crucial turning point where it has sustained its high growth, significantly reduced its poverty and unemployment rates, and expected to reach upper-middle income country status way ahead of schedule next year.
“We have decisively broken out of the former boom-and-bust cycle that inhibited our projects in the past. We are consolidating for rapid and inclusive growth well into the foreseeable future,” said Secretary Dominguez.
Secretary Dominguez said reaching these milestones with the ultimate goal of making the Philippines a country free of extreme poverty would not have been possible without the support of the ADB, which he described as “one of our strongest partners in sustaining progress towards shared growth and prosperity”
During the event, Secretary Dominguez also took the opportunity to thank outgoing ADB president Takehiko Nakao “for being a true friend and partner of the Filipino people and for his untiring support for the country’s development.”
Secretary Dominguez also looked forward to an even more “robust” relationship with the ADB under the leadership of its incoming President Masatsugu Asakawa, who is set to assume his post in Jan. 16 next year.
The additional financing for the Infrastructure Preparation and Innovation Facility will enable the Philippine government to undertake engineering and feasibility studies for major “Build, Build, Build projects,” such as the Bataan-Cavite Interlink Bridge, Samal Island-Davao City Connector Bridge, Mindanao Railway Project, Metro Manila Subway, Subic-Clark Railway, North-South Commuter Railway System and the Metro Rail Transit (MRT)-Line 4 from Ortigas in Metro Manila to Taytay, Rizal.
For the Capacity Building to Foster Competition Project, the ADB will provide funding support to help the government improve its capacity to enforce the Philippine Competition Law to promote free and fair competition in various economic activities and industries.
The Facilitating Youth School-to-Work Transition Program Subprogram 2, meanwhile, aims to strengthen the government’s ability to carry out policy reforms and initiatives designed to improve the employability of the Philippines’ young and skilled workforce.
Vice President Saeed said the initial implementation of this youth employment facilitation program has translated into a net of 1.3 million new wage jobs created in the 12 months to October 2019.
The success of the program, he said, is “reflected in the most recent unemployment rate of 4.5 percent,” which is the lowest rate recorded in 40 years.
Also at the loan signing ceremony were Philippine Competition Commission (PCC) Chairperson Arsenio Balisacan, ADB Executive Director Paul Dominguez and ADB Philippines Country Director Kelly Bird.
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