Philippine signs $1-B loan deal with South Korea

MANILA, Philippines — The Philippines has signed an agreement with South Korea that would enable the Duterte administration to borrow as much as $1 billion over the next five years.

Foreign Affairs Secretary Alan Peter Cayetano and Korean ambassador Han Dong-man last Friday signed the framework agreement that would give the Philippines access to South Korea’s Economic Development Cooperation Fund (EDCF).

“I welcome South Korea’s heightened engagement in the Philippines’ development as evident in this newly signed framework arrangement,” Cayetano said in a statement.

“We note and highly appreciate the confidence that the government of South Korea has shown by doubling the previous amount and duration of access from the previous framework arrangement which was signed in November 2011,” he added.

The Philippines first got access to EDCF in 2011 following the signing of a three-year agreement that allowed the country to borrow as much as $500 million.

Projects that were funded by the previous loans were the Panguil Bay Bridge connecting Tangub City and the municipality of Tubod in Misamis Occidental, Puerto Princesa Airport Development Project in Palawan and Samar Pacific Coastal Road Project that completed the circumferential road loop of Samar Island.

The Duterte administration has yet to identify the projects that would be funded by the new round of loans from EDCF.

The EDCF was established by the South Korean government in 1987 and is administered by the Export-Import Bank of Korea.

In a separate statement, the Department of Foreign Affairs (DFA) yesterday welcomed the recent meeting between South Korean President Moon Jae-in and North Korean leader Kim Jong Un where they agreed to work toward ending the decades-long Korean War.

“It is hoped that this development will contribute to the ongoing process of reducing tensions, the peaceful resolution of prevailing issues between concerned parties and the eventual denuclearization of the Korean Peninsula that will contribute to the peace and stability of the region,” said the DFA.

“The Filipino people stand with our Korean brothers and sisters at this critical moment in history,” it added.

On April 27, Kim and Moon announced that they would work with the US and China to declare an official end to the Korean War that started in the 1950s.

The declaration included promises to pursue phased arms reduction, cease hostile acts, transform their fortified border into a peace zone and seek multilateral talks with other countries.