ADB approves loan for PH infra program

Published August 20, 2018, 12:00 AM

by manilabulletin_admin

By Chino S. Leyco

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The Asian Development Bank (ADB) has extended another financing support to the Duterte administration’s program aiming to boost the country’s infrastructure.

In a statement, the Manila-based multilateral institution said yesterday that it has approved a $300 million policy-based loan for the government’s “Build, Build, Build” infrastructure development program.

According to the ADB, the fresh loan should “strengthen the framework under which the private sector can participate in the government’s Build, Build, Build.”

The financing is under the ADB’s Expanding Private Participation in Infrastructure Program (EPPIP) subprogram 2, which seeks to create the enabling policy environment for public-private partnership (PPP) projects to flourish using private sector expertise and innovation.

Cristina Lozano, ADB senior trade specialist, said that PPPs can raise the quality of life for citizens by providing reliable public services through efficient infrastructure.

“Reforms under the EPPIP program have been successful in stimulating the PPP market and improving the quality of infrastructure projects in the Philippines,” Lozano said.

With its fast-growing economy, archipelagic geography, expanding population, and rapid urbanization, ADB said the Philippine government aims to raise infrastructure investments to 7.4 percent of Gross Domestic Product (GDP) by 2022 from 5.1 percent in 2016.

The BBB program, part of the medium-term Philippine Development Plan, is estimated to require a total $168 billion in investments for 75 high-impact priority projects nationwide.

To finance this, the government wants to use an optimal funding mix composed of government spending, official development assistance, and private capital.

“ADB has been supporting reforms that have helped ensure sustainable funding for government direct and contingent support to PPPs, improve long-term infrastructure planning, [and] strengthen the government’s capacity to manage the PPP program,” the bank said.

It also said that ADB has helped to enhance the legal framework for PPP preparation, approval, and implementation.

Reforms also helped facilitate the use of PPPs by local government units (LGUs) as an alternative in pursuing infrastructure development, ABD said.

The government-run PPP Center provided support to LGUs to develop and implement PPP projects in priority sectors such as water supply and sanitation, solid waste management, and urban transport.

“The Philippines has made significant progress since the PPP program was launched in late 2010,” Kelly Bird, ADB country director for the Philippines said.

“With a huge project pipeline being rolled out under the BBB program of President Rodrigo Duterte, leveraging public resources via private sector participation remains relevant,” Bird added.

Since 2010, the government has awarded a total of 16 national PPP projects worth around $6.2 billion, of which 12 were tendered and awarded during the implementation of EPPIP. Feasibility studies for six projects were also completed during the program period.