World Bank commits more aid to Philippines

MANILA, Philippines - The World Bank (WB) is committed to expanding its financial assistance to the country beyond the $3.7 billion earmarked for various development and disaster response projects.

Robert Zoellick, WB group president, said the latest commitments include a $500-million “rapid response contingent line of credit” for emergency relief, recovery and reconstruction, and a $2-million grant under the Global Facility for Disaster Reduction and Recovery program.

“We actually have increased our resource program for the Philippines,” Zoellick told reporters in a press conference at the WB office in Ortigas, Pasig City yesterday.

“We have a total of about $3.7 billion in outstanding commitments across the World Bank group so that includes about $2.6 billion from IBRD (International Bank for Reconstruction and Development) – that’s the public lending arm (of the WB) and about $933 million, that’s almost a billion, from IFC (International Finance Corp.) – our private sector side,” he said.

“But just this year we made about $1.5 billion to $2 billion of commitments from IBRD and we expect to be up to about $200 million on top of that on IFC private sector commitments,” Zoellick said.

“And we hope in the next fiscal year to have the IFC go up to over $300 million. So we’ve been expanding the program,” Zoellick added.

“The Philippines has been an important partner,” he pointed out.

“I was able to assure President Aquino of World Bank support through a new rapid response line of credit worth $500 million that can be drawn on immediately in the event of a major natural disaster,” he said.

“And I am pleased to announce a $2-million grant which will help the Philippines gain access to global best practices in disaster risk reduction,” he said.

Eye on CCT

Zoellick said the WB is particularly interested in the Philippines’ implementation of the conditional cash transfer (CCT) program.

“The CCT offers a final safety net to the poor of developing countries. It has cushioned already some 2.2 million families and six million children,” Zoellick said.

“The Philippine program is one of some 40 conditional cash transfer safety net programs that the World Bank has helped develop around the world. The idea actually started in Mexico and then Brazil, which have launched these very successful anti-poverty programs that cost about one half of one percent of GDP,” Zoellick said.

“These conditional cash transfer programs are a great example of how developing countries, with the help of the World Bank, can learn from one another,” he added.

“At the World Bank, we believe that every country should have a targeted, effective, efficient social safety net program that doesn’t bust the budget – because certain events, whether arising from Europe, the Americas, or Asia – can compromise the poor. And the poor need a partner too,” he maintained.

Zoellick said that the WB is also committed to helping the country’s agriculture and fisheries sector adopt measures to protect them from climate change.

“I’ve also been impressed by the resilience that the country has shown to recent external shocks. Strong financial and trade resources and economic fundamentals have helped cushion the impact of the global economic turmoil on the local economy,” Zoellick said.

He also cited the WB’s keen interest in the way the Aquino administration is implementing infrastructure programs through the public-private partnership (PPP) scheme.

“We also stand ready to assist the government as it deals with the public-private partnership agenda and to help business, rural investments, and encourage government improvements through our private sector arm, IFC,” Zoellick said. 

Meanwhile, Social Welfare and Development Secretary Corazon Soliman clarified that the government is seeking additional funds for the CCT and is negotiating for $100 million with the WB.

“The World Bank did not offer ($100 million as available fund). The Philippine government is in negotiations for additional financing for the CCT. That’s more accurate,” she said. – With Delon Porcalla