RP secures $4-B US investments, aid

WASHINGTON, DC (via PLDT) — Over $4 billion and counting.

The Philippines secured Tuesday a total of $4.6 billion in investments, development assistance, trade commitments and tariff concessions from the US government and private companies.

"It’s over four billion (dollars) and counting," a beaming President Arroyo told reporters here on the eve of her departure for Mexico. "These are the fruits that will generate jobs."

Topping the list is the $1 billion in General System Preferences benefits unilaterally provided by the US government following the expiration of the last GSP on Sept. 30 worth $800 million.

The GSP allows selected Philippine-made imports to be exempted from tariff. In this case, the Philippines will enjoy tariff concessions worth $1 billion. Mrs. Arroyo said the government will push for the inclusion of new products in the GSP list.

"This was given unilaterally, not under the WTO (World Trade Organization) or any trade agreement," she said.

The President also said the country was declared eligible for a $400,000 debt treatment program under the US Tropical Forest Conservation Act, more commonly known as the debt-for-nature swap.

The swap provides for the cancellation of a portion of concessional debt owed to the US in exchange for the commitment to use the local currency payments to fund domestic foreign conservation activities.

A memorandum of agreement was signed by the two countries’ departments of agriculture to renew and expand activities involving wide-ranging scientific, technological and agribusiness cooperation.

Under the agreement the USDA will make available guarantee programs of $150 million for US agricultural exports and equipment that support the modernization of agriculture and fisheries.

The USDA will also extend a grant of $3 million for the Philippine agriculture sector.

Mrs. Arroyo also announced the US-based Overseas Private Investment Corporation (OPIC) will extend a special line of $200 million credit for US investments in the country.

A joint communiqué issued by the White House said Mrs. Arroyo and President George W. Bush agreed to work hard to increase American investments in the Philippines.

A $55-million aid package for Mindanao in 2001 and 2002 was also committed for Mindanao, especially for the Autonomous Region in Muslim Mindanao.

"This Mindanao assistance package will provide direct support for the nascent peace process by integrating the ex-combatants (secessionists) and their communities into the peacetime economy," the joint communiqué said.

The package includes a $825,000 fund in new education and cultural exchanges, such as Fulbright grants, for Muslim beneficiaries.

In trade and investments, agreements on information and communications technology between the US and Philippine firms yielded a total of $23.7 million in investment commitments with an estimated 11,300 jobs to be generated.

For infrastructure, a US firm plans to build a $500-million airport railway system under the build-operate-transfer scheme in Mindanao, while a $100-million shipyard project in Subic is expected to commence in the following months.

Meanwhile, a private equity firm owned by former US vice president Dan Quayle has set up a $1 billion fund to aid distressed companies in the Philippines.

Cerberus Asia will either buy receivables and restructure or sell them. It may also buy equity into a distressed firm and set up its own management team to rehabilitate it.

The United Parcel Service disclosed its intention to set up a hub in Clark worth $200 million, while Ford plans to revive its assembly presence in the country to export some $300 million worth of products to Indonesia and Thailand annually.

US-based garment firms, meanwhile, committed to increase their imports of Philippine-made products to $500 million annually. — Paolo Romero