Manila, Tokyo to seal 1.5 billion yen grants for Coast Guard, Marawi rehab

November 12, 2017

The Philippine and Japanese governments will soon sign the exchange of notes on projects for rehabilitating Marawi City and strengthening maritime safety capability of the Philippine Coast Guard, according to the Department of Finance (DOF).

In a report to Finance Secretary Carlos Dominguez III during a recent DOF Executive Committee (Execom) meeting, this department’s International Finance Group (IFG) said a grant of 1.5  yen billion (estimated at P676 million) from the Embassy of Japan will be given to the Department of Public Works and Highways (DPWH) in the form of heavy equipment and machineries to be used for the rehabilitation and reconstruction of heavily damaged Marawi City.

The equipment includes bulldozers, excavators and dump trucks, the IFG said.

The Philippine Coast Guard (PCG) will receive  Japanese aid in the form of equipment for the improvement of its maritime safety and counter-terrorism capability, the IFG told Dominguez.

These include radar systems, closed circuit televisions, and radio systems, it said.

In the visit of President Rodrigo Duterte to Japan last year, Dominguez and Japan International Cooperation Agency (JICA) president Shinichi Kitaoka formalized several agreements that would help improve the Philippines’ maritime safety capability, including a deal for a 16.5 yen billion concessional loan covered by Tokyo’s Official Development Assistance (ODA) for the acquisition of two large-scale patrol vessels for the PCG.

The loan was part of Tokyo’s continuing assistance to the PCG’s Maritime Safety Capability Improvement Project (MSCIP).

Equivalent to P6.8 billion, this JICA loan was extended at an interest rate of between 0.01 (consulting component) and 0.10 (non-consulting component) percent per annum with a maturity period of 40 years, inclusive of a 10-year grace period.

The acquisition of two 94-meter large-scale patrol ships under Phase Two of the MSCIP is on top of the ongoing official development assistance (ODA) from Japan for the first phase of the project, which involves the procurement of 10 units of 40-meter PCG patrol vessels.

As of June 2017, five out of 10 vessels have been delivered to the Philippines. The targeted completion of the delivery of all the 10 vessels is in August 2018.

Besides the loan agreement, Japan had also announced the provision of additional vessels for the PCG through a JPY600 million grant (about P280 million) for the procurement of high-speed boats and other equipment to boost the Philippines’ anti-terrorism and security activities.

This grant covers the acquisition of one 20-meter high-speed vessel and 14 units of 7-meter high speed boats.

In a high-level infrastructure cooperation meeting between Japan and the Philippines held last July in Manila, a list of projects with an estimated total cost of P315.4 billion were pipelined for possible Japanese financing.

Both sides also exchanged views on the support for Mindanao and other areas of cooperation including power and energy, anti-illegal drug measures, public safety and counterterrorism, and information and communications technology.

The Japanese delegation also extended their condolences to the families of those who killed in the ongoing Marawi crisis and expressed their support for the Philippines’ needs for reconstruction and efforts against terrorism.

It also expressed hope that normalcy in Marawi would be restored as soon as possible and reiterated its readiness to provide the necessary assistance for the quick recovery of the city in particular, and development of Mindanao in general.

Later at the third high-level infrastructure cooperation meeting held in Tokyo, the Philippines and Japan agreed to further streamline their respective approval processes and introduce new measures to put on the fast lane the implementation of big-ticket projects presented by Manila to Tokyo for possible financing.

Both panels agreed these steps were necessary “for more efficient decision making, and swift execution such as in project preparation and formulation, due diligence, procurement process and project implementation including land acquisition and resettlement.” DMS