South Korea lends $50 million for BBB feasibility studies

MANILA, Philippines — The South Korean government has provided the Philippines a $50 million loan to help facilitate the study and planning of projects under the Duterte administration’s Build Build Build program, the Department of Finance (DOF) said yesterday.

In a ceremony held at the DOF yesterday, Finance Secretary Carlos Dominguez and Export-Import Bank of Korea Chief Representative Sungho Jang formally exchanged the loan documents for the Philippines-Korea Project Preparation Facility (PKPPF).

The loan, amounting to $50 million (or P2.73 billion), accounts for 70 percent of the total funds to be made available at the facility, which is $71 million.

The loan agreement for the PKPPF was earlier signed by Dominguez, on behalf of the Philippine government, and KEXIM senior executive director Deog-Yong Shin.

Dominguez said the loan, which carries a zero-percent interest rate, would fund the preparation activities, such as pre-feasibility and feasibility studies, detailed engineering designs, and safeguard assessment, for projects under the Philippines’ Build Build Build program.

“These are necessary and integral aspects of any project as they help us determine whether a particular project is economically viable and sustainable over the long term and, ultimately, whether the Filipino people will reap the economic benefits and outweigh the public resources that the government might invest,” the finance chief said.

Dominguez expressed confidence that the loan would hasten the execution of several major water and irrigation, flood control, and road and bridge projects all over the country.

The loan will primarily benefit projects implemented by the Department of Public Works and Highways (DPWH) and the National Irrigation Administration (NIA).

Jang, for his part, said the PKPPF is expected to play a key role not only in the conceptualization, but also in the implementation of infrastructure projects in the Philippines.

He said there are currently 15 projects being considered under the facility.

According to the DOF, the $21 million balance under the PKPPF will be financed by the Philippine government through the project’s implementing agencies.

Aside from being a zero-interest loan, KEXIM granted the Philippines a repayment period of 40 years, inclusive of a 10-year grace period.