ADB okays $30-M facility for low-cost housing projects outside Manila

The Asian Development Bank (ADB) has approved a $30-million loan and a $1.5-million technical assistance (TA) grant to provide affordable housing for some 20,000 urban poor families in areas outside Metro Manila (AOMM).

The ADB loan represents 62.5 percent of the total project cost of $48.8 million. It will come from the ordinary capital resources and carries a 25-year term, including a grace period of six years. Interest is based on Libor-based lending facility.

Local government units (LGUs) will provide a counterpart fund of $6.3 million while the National Government will provide $3.5 million, mostly in the form of government-owned land. Several co-financiers are also reported to be interested to partner with ADB to enhance the capacity building component. Assistance from the Finnish and German governments have been programmed.

The Development Bank of the Philippines (DBP) and the Housing and Urban Development Coordinating Council (HUDCC) will be the executing agencies. The project is due for completion at the end of 2009.

Known as the Development of Poor Urban Communities Sector Project, it has three components:

LGUs will be given funds to develop sites and to distribute land titles to informal settlers, in partnership with communities and non-government organizations (NGO).

Beneficiaries will be given access to microcredit for shelter finance and small enterprise development.

The capacity of communities, LGUs, and government housing agencies to facilitate community-driven planning will be strengthened to decentralize shelter delivery.

The six-year project will be patterned after ADB’s pilot projects for the urban poor in Payatas and Muntinlupa (both in Metro Manila), which have been successful in community mobilization, shelter and infrastructure provision and financing, and livelihood support. – Ted Torres