JICA laments slow drawdown on P10-B shipping package

The country’s Japanese benefactors have been reportedly dismayed with the way the P10-billion loan package for the improvement of the nautical highway are being disbursed, according to the country’s top economic planning manager.

In an interview, National Economic and Development Authority (NEDA) director general Romulo L. Neri said the Japan International Cooperation Agency (JICA) has expressed disappointment with the way the Development Bank of the Philippines (DBP) handled the initial P10-billion loan released in 1999.

"The loans are not moving," Neri said, referring to the money loaned through the Domestic Shipping Modernization Program which DBP handled. 

However, Neri cleared that this was not the fault of the state-run bank. "It’s the law and DBP is constrained by it," he explained. 

JICA said the term loan under DBP required an 80-percent loan value and 50-percent chattel mortgage collateral value of the vessel which became a big burden for private shipping companies to avail. 

"The program was unable to achieve its objectives," JICA said. 

To address this problem, JICA proposed that the government create the National Maritime Leasing Corp. (NMLC). Now, instead of DBP handling the shipping modernization program, the NMLC will be in charge of financing acquisition of modern vessels to be leased to qualified operators under the Finance Lease Program.  

In turn, the Japanese government, through JICA, will coordinate with NMLC to conduct technical assistance to construct brand new vessels in Philippine shipyards which will create a healthy, robust, shipbuilding sector of the local maritime industry

The Japanese government is poised to lend an additional $1 billion to the Philippines for the modernization of its maritime industry.

"It is very clear for JICA to recommend to the Japan Bank for International Cooperation a loan through program assistance of $1 billion to be granted to the Philippine government through NMLC," JICA said.