Japan to provide Philippines loans for 3 projects

October 30, 2017

The Philippines and Japan exchanged notes on Monday for a flood risk management project.

This as Prime Minister Shinzo Abe also pledged the financing support for subway and road projects.

In a ceremony at the Prime Minister's Office, Abe and President Rodrigo Duterte witnessed the signing of the exchange of notes concerning on the provision of a yen loan for the Cavite Industrial Area Flood Risk Management Project.

The exchange of notes for the project, with a loan provision of up to 15.928 billion yen, was signed by Foreign Affairs Secretary Alan Peter S. Cayetano and Japan Foreign Affairs Minister Taro Kono.

The project aims to reduce flood damage in the Cavite province, which is mainly an industrial area, by implementing measures to counter flooding, and is thus expected to help overcome vulnerability and contribute to sustainable economic growth in the Philippines.

The untied loan has 0.3% interest rate per annum and payable in 30 years after a grace period of 10 years.

Abe also vowed the provision of a yen loan for the  104.53 billion yen Metro Manila Subway Project (Phase 1) and the 9.399 billion yen Arterial Road Bypass Project (Phase III).

"Based on this pledge, the Government of Japan and the Government of the Philippines are scheduled to sign an exchange of notes concerning the yen loan in the future," a statement from the Ministry of Foreign Affairs of Japan said.

The subway project is expected to contribute to relieving serious traffic congestion in Metro Manila by seeking to meet growing transportation demand, as well as to ease atmospheric pollution and climate change.

It is a tied loan with interest rate of 0.1% per annum and payable in 28 years after the grace period of 12 years.

The road project, on the other hand, will contribute to relieving traffic congestion and improving transportation capacity and efficiency in the vicinity of Plaridel City, a major urban area in the suburbs of northern Metro Manila.

It is general untied loan with interest rate of 1.5% annually and with repayment perod of 20 years after a grace period of 10 years.

Duterte is on a visit to Japan, his second since he assumed office last year. Celerina Monte/DMS