ADB offers $1.75 billion in crisis support to Philippines

MANILA, Philippines — The Asian Development Bank (ADB) has offered to provide up to $1.75 billion worth of additional financing to help the Philippines manage the impact of the Middle East conflict.

In a statement yesterday, the multilateral lender said the offer was made during a meeting between ADB president Masato Kanda and President Marcos.

The support that ADB offered will be through additional policy-based and countercyclical lending, as well as trade finance if needed, to help the government manage fiscal pressures and mitigate the impact of oil supply and other shocks on the economy, particularly on vulnerable households.

The amount is also on top of around $2 billion in policy-based loans being prepared by the ADB for the Philippines this year. 

“The Philippines is ADB’s home and we see the strain this crisis is placing on Filipino families, workers and businesses,” Kanda said.

Given its heavy reliance on imports for oil, fertilizers and other global commodities, the Philippines has seen the Middle East conflict translate into higher prices in the market.

In response, the government declared a national energy emergency last March.

The government also rolled out the Unified Package for Livelihoods, Industry, Food and Transport, which includes fuel subsidies, excise tax reductions on some oil products and cash assistance for transport workers, farmers, fishers and repatriated overseas Filipino workers.

For its part, ADB is working with government agencies to protect vulnerable Filipinos and strengthen the country’s longer-term resilience. 

In particular, ADB is providing advisory support to the Department of Agriculture on domestic fertilizer security and assistance to the Department of Social Welfare and Development on social protection.

To reduce exposure to fuel price shocks, the ADB is also providing support through energy security, clean energy, energy efficiency and mass transit investments.

“ADB will act swiftly to support the government to protect vulnerable communities, manage fiscal pressures and strengthen the economy’s resilience,” Kanda said.