The largest component of the offer was $60 million in short-term GSM-102 export credit guarantees for fiscal 2003, which began on Oct. 1.
Short-term credits run up to three years for a long list of US agricultural exports. Credits facilitate sales by assuring lenders they will get their money back even if the borrower defaults.
The USDA also offered the Philippines $2 million in long-term GSM-103 credits, running three to seven years, and $10 million in supplier credit guarantees on US farm sales.
In addition, $5 million was offered in credit guarantees on sales of US products to improve agriculture-related facilities in the Philippines.
But even while cash-strapped government is scrounging around for money, there is some P1.774 billion in grants for agriculture projects that remain untapped because of bureaucratic entanglements.
The amount reprents the accumulated grants from the Japanese government, particulary the 21st-25th Kennedy Round II (KR II) or the RP-Japan Increased Food Production Program.
Sources from both the National Economic and Development Authority (NEDA) and the Department of Agriculture (DA) said the money, acquired from 1997 to 2001, has not been endorsed for release by the NEDA’s Investment Coordinating Council (ICC).
Officials from both government agencies said the money is being held in abeyance because the DA and NEDA have not resolved issues left by former DA Secretary and now Senator Edgardo Angara and ex-NEDA chief Felipe Medalla.
The two former secretaries reportedly had a verbal agreement wherein the DA’s attached agency, the National Agricultural and Fishery Council (NAFC), will solely handle the monetization of proceeds from the KR II grants.
Sources said that prior to the verbal agreement, NEDA-ICC managed to have the fund management of the grants transferred to its department, but this function was later reverted back to the NAFC which was more adept in monetizing the grants.
As a concession though, the ICC was to allot 50 percent of all KR II grant proceeds for social development, and the other 50 percent was for agriculture projects.
Before this arrangement, all KR II grants went entirely to financing approved agriculture projects but approvals were decided solely by the ICC. This was also amended, the ICC no longer had a hand in approving the proposed agriculture projects.
Since the reported verbal agreement between Medalla and Angara took place however, there were no efforts on both parties to put the agreement in writing and no further dialogues were held to thresh out specifics of the exchange.
"There is money for agriculture projects but unless both department open discussions again, the money is just there, left idle and can’t be accessed," a DA official said.
Sources said the NEDA had wanted to handle all approvals and became particular about the utilization of KR II grants, mostly in the form of fertilizers which is monetized and used for agricultural projects.
Utilization of the KR II grant in the past came under heavy fire when questions were raised about its uses and beneficiaries of the projects. – Rocel Felix