The government is tapping the Organization of the Petroleum Exporting Countries (OPEC) to help finance a P2.115-billion poverty alleviation program in the Cordilleras.
The Bangko Sentral ng Pilipinas (BSP) said the Monetary Board has approved in principle a proposed loan from the OPEC Fund for International Development to partially finance the Second Cordillera Highland Agricultural Resource Management Project or CHARM 2.
BSP deputy governor and officer-in-charge Armando Suratos told reporters that the program would be funded out of official development assistance from the OPEC Fund as well as from the Asian Development Bank (ADB) and the International Fund for Agricultural Development (IFAD).
Suratos said the government would borrow $10 million from the OPEC Fund and another $10 million from ADB, while the bulk, amounting to $27 million, would come from IFAD.
The entire project is estimated to cost an equivalent of P2.115 billion and would focus on increasing the farm income of upland families in Abra, Benguet and Mt. Province.
Suratos said the project is now on its second phase; it was initially implemented in 1997 and 2004.
Suratos said Phase 2 would continue the poverty alleviation aspect of the first phase by improving the livelihood of indigenous communities and institutionalizing their resource management and land ownership.
Suratos said the IFAD approved its funding for the program last February. For its part, the ADB is still processing the loan application before it is brought up to the Monetary Board for clearance.
Suratos said the OPEC loan will have a maturity period of 20 years, including a five-year grace period, and a three percent interest per annum.
Both the IFAD and ADB were involved in the first phase of CHARM but in the second phase, IFAD said the project would emphasize environmental concerns, better use of existing staff resources and strengthening of local government units.
The IFAD said the project aims to improve the disposable income of upland families, promote sustainable resource management, protect the environment and mitigate adverse effects of development, strengthen existing institutions, involve poor people in planning and implementation, and improve their access to formal and informal credit.
CHARM 2 will involve mobilizing communities and improving natural resource management, with focus on the poor villagers’ participation in community-based forest management.
The IFAD said the project will also fund the development of rural infrastructure, rehabilitation of existing roads to improve access to agricultural production areas, and the construction of communal irrigation and safe water supply systems.