Dominguez seeks additional AIIB support for infra projects

June 27, 2018

Finance Secretary Carlos Dominguez III has sought the support of the Asian Infrastructure Investment Bank (AIIB) in funding other big-ticket infrastructure projects under the Duterte administration’s "Build, Build, Build" program following the institution’s approval last year of its first project in the Philippines in partnership with the World Bank.

Dominguez underscored the urgency of developing both the physical and digital infrastructure of the Philippines and other emerging economies in Asia to hasten the  development of a common market across the region and transform Southeast Asia into a strong base for trade, the Department of Finance (DOF) said in a statement Wednesday.

“A dynamic regional common market will provide our economies a strong base to build competitive industries and profitably trade with the rest of the world.  An emergent Southeast Asia will complement the mature economies of East Asia and the rapidly growing Indian subcontinent,” said Dominguez during the Asian Infrastructure Forum (AIF) seminar on “Advancing Together: ASEAN Infrastructure Development” held at the Experimental Theatre of the National Centre for the Performing Arts  in Mumbai, India.

Dominguez was among the inaugural speakers at the first set of seminars of the AIF following its launching on June 26.

Dominguez said, “this arc of progress will constitute the center of gravity of the global economy, the engine of economic expansion that will help propel all other economies.”

In the Philippines, Dominguez said its massive infrastructure buildup has been made possible by the expanded support of its friends in the region as well as of multilateral agenies such as the AIIB.

The AIIB has so far committed to co-finance with the World Bank the first phase of the Metro Manila Flood Management Project, which will be built to improve flood forecasting, reduce long-term flooding and modernize pumping stations and build new ones in the National Capital Region and its surrounding areas.

Among the projects that the Philippines has pitched to the AIIB for possible financing support  are the Metro Manila Bus Rapid Transit System (Phase 3 from Bonifacio Global City to Ninoy Aquino International Airport), the Pasacao-Balatan Tourism Coastal Highway in Camarines Sur, and the Camarines Sur Expressway Project (San Fernando-Pili Section).

The AIF aims to gather policy makers and experts involved in infrastructure development in practical and project-driven discussions that focus on matching innovative financing programs to critical infrastructure needs.

Dominguez said the initiative to improve infrastructure across the region, which is the AIIB’s primary goal, “will help stimulate economic activity in all our economies and help us build inclusive growth for our people” in the immediate term, and  “improve the interconnectivity of the region’s economies and foster productive exchange” over the longer term.

Dominguez said this is why President Rodrigo Duterte launched the “Build, Build, Build” program, which involves 75 high-impact projects, of which 35 already hurdled the approval processes and are ready for execution.

Ten of these projects are moving into the construction stage this year, with 25.4 percent of the national budget committed to infrastructure investments, which is equivalent to 6.3 percent of the Philippines’ gross domestic product (GDP).

By 2022, Dominguez said the government projects public spending on infrastructure to increase to 7.3 percent of GDP.

“This is the highest investment in infrastructure in our history and, as a percentage of GDP, possibly the highest in the region,” Dominguez said.

Such spending has been made possible by the Duterte administration’s comprehensive tax reform program (CTRP), which has now started to ensure steady and reliable revenue flows for the government, he said.

The 10 “Build, Build, Build” projects set to start construction this year are worth a combined P59.759 billion.

These are the:  1) Phase 1 of the P35.257-billion Mindanao Rail Project (Tagum-Davao-Digos Segment), 2) P4.607-billion Binondo-Intramuros Bridge, 3) P1.367-billion Estrella-Pantaleon Bridge, 4) P4.372-billion Chico River Pump Irrigation Project; 5) P1.780-billion Clark Green City Government Center, 6)P850-million Clark Green City Commercial Center, 7) P3.331 -billion Clark Green City Mixed Income Housing, 8) P2.335-billion operations and maintenance of the New Bohol Airport, 9) P4.858-billion Panguil Bay Bridge Project, and the 10)  P1-billion drainage improvement of the remaining sections along Pasig River from Delpan Bridge to Napindan Channel. DMS