BSP okays two JICA loans worth $250 million

MANILA, Philippines - The Bangko Sentral ng Pilipinas (BSP) has approved two concessional loans worth over $250 million of the national government from the state-run Japan International Cooperation Agency (JICA).

BSP Governor Amando M. Tetangco Jr. said the Monetary Board (MB) has given its final approval for two official development assistance (ODA) loans to be be provided by JICA.

Tetangco said the first loan worth $150 million or ¥13.83 billion will come from the emergency budget support Japanese ODA loan of JICA.

It would carry an interest rate of six-month Japanese Yen LIBOR payable in 15 years including a three-year grace period.

On the other hand, the BSP also approved the $100 million or Y9.22 billion to finance the Development Policy Support Program (DPSP) subprogram 3 being undertaken by the Department of Finance (DOF).

The loan would be co-financed by the Asian Development Bank and payable in 30 years including a 10-year grace period with an interest rate of 1.4 percent per annum.

Both loans would involve a commitment fee of 0.1 percent per annum based on the amount disbursed accruing 120 days after the date of the signing of the loan agreements.

The program intends to improve fiscal sustainability, maintain macroeconomic stability and improve credit worthiness. It would also help enhance governance in public financial management and at the same time speed up disbursements for critical public spending.

Other benefits of the program include the improvement of the country’s investment climate and rural development as well as the enhancement of human capital and social inclusion.