Aerospace industry seeks loan payments breather

MANILA, Philippines — The Philippine aerospace industry wants a one-year grace period for loan payments under the Bayanihan 2 bill to help the sector during the pandemic.

In a letter to Sen. Sonny Angara and Rep. LRay Villafuerte, Aerospace Industries Association of the Philippines (AIAP) president Dennis Chan said the group backs the provision in the Bayanihan 2 bill for a one-year grace period for loan payments due within the government-mandated quarantine without incurring interest, penalties, fees or other charges.

Chan said there is a clear need for the moratorium right now as many in the aerospace industry are in a critical situation.

He said other countries, including Thailand, have started a one-year extension for all loan principals to help businesses.

The bicameral conference committee has agreed to give a 60-day reprieve for the payment of all types of loans under the reconciled Bayanihan 2 bill.

Apart from the one-year grace period on loan payments, the AIAP is also supporting a provision in the Bayanihan 2 bill, which allows the Bangko Sentral ng Pilipinas and the Securities and Exchange Commission to relax regulatory and statutory restrictions and requirements for up to 10 years to encourage lending to businesses.

The group also favors the creation of a special holding company under the bill to help strategically important companies affected by the pandemic address solvency issues.

“As of now, most airline-associated supply chains are greatly affected, and this provision can maintain and sustain the industry so it will be able to get back on track,” Chan said.

He said the AIAP likewise supports the proposals of the Department of Trade and Industry (DTI), which include domestic preference for government purchases, relaxing nationality restrictions for foreign firms investing in production facilities, and incentives for firms retaining 90 percent of the workforce to support manufacturing under the Bayanihan 2 bill.

Meanwhile, the Samahan sa Pilipinas ng mga Industriyang Kimika (SPIK) or the Chemical Industry Association of the Philippines wants the Board of Investments to request the bicameral committee to include manufacturing and construction in the funding allocations of the consolidated Bayanihan 2 bill.

In a letter to DTI Secretary Ramon Lopez, SPIK executive director Jeffrey Mijares said the two sectors were significantly affected by the pandemic, declining 21.3 percent and 33.5 percent, respectively in the second quarter.

He said the two sectors are also seen as major players in helping the economy bounce back through job generation.

“The faster the two mentioned industries can recover through government funding assistance, the faster will be the recovery of the Philippine economy,” he said.