This was revealed yesterday by Development Bank of the Philippines (DBP) president Remedios Macalingcag who, however, refused to admit that the imposition of more stringent conditions may have something to do with the country’s current political instability.
The DBP and JBIC are currently negoating a ¥70-billion or P30.5-billion loan under what the DBP labels as a Jexim 5 loan.
The JBIC is the institution institution that emerged after the merger of the Japan Export-Import Bank and the Overseas Economic Cooperation Fund. Macalingcag said negotiations for the Jexim 5 loan are scheduled for completion in March this year.
However, due to the JBIC’s decision to impose more stringent conditions, Macalingcag said, the negotiation could last up to the second quarter of the year.
The DBP, Macalingcag said, is asking the JBIC to impose conditionalities that are "within our control." She, however, refused to divulge what they are.
Based on its negotiations with other government institutions, the JBIC is now asking for direct National Government guarantee for all its loans.
In the past, the DBP could independently negotiate loans with the Jeximbank and OECF. If a direct National Government guarantee is required, all negotiations would have to include the Department of Finance.
Macalingcag pointed out that under the Jexim 4 loan, the then Jeximbank did not impose tough conditionalities. All it required were the usual fees and counterpart funding.
Macalingcag said the JBIC’s new management may have just thought of the need to impose stricter conditionalities.
Aside from the Jexim 5 loan, the DBP is also negotiating a ¥55-billion or P24-billion Community Development Project from JBIC.
The two JBIC loans are part of the total P44-billion pipeline loans that the DBP is negotiating for this year.
The other loans that are under negotiation for this year are a KFW Local Government Unit Solid Waste Management loan amounting to 70 million deustche mark or P1.66 billion; a World Bank LGU Urban Water and Sanitation Project loan amounting to $60 million or P3 billion and a $20 million or P999 million loan from the Nordic Investment Bank.