LOANS availed of by the Philippines from the Asian Development Bank (ADB) are expected to hit $9.4 billion between 2021 and 2023 to increase its funds for infrastructure buildup and Covid-19 recovery programs.
In a briefing on Wednesday, ADB Country Director for the Philippines Kelly Bird announced that the agency has unveiled its country operations business plan (COBP) for 2021 to 2023. The COBP is made up of projects the multilateral institution is spending on the Philippines for the next three years, in its recovery from the Covid-19 pandemic.
Bird said the COBP has two phases, namely, the rebuild and recovery, wherein the first focuses on repairing the damage brought about by the health crisis on the business sector, labor market and social services, while the latter centers on funding infrastructure projects that have a growth multiplier, especially to employment.
According to the ADB, nearly half will be rolled out by next year, largely for the construction of the South Commuter Railway Project Tranche 1. The first part of the project that will connect Calamba, Laguna, to Blumentritt in Manila will cost $4.3 billion all in all, and $1.75 billion will be spent by next year.
The ADB will also lend the government funds to implement and localize universal health care, as well as facilitate youth school-to-work transition and reforms at the local government level.
The ADB is anticipating 2021 lending to reach $3.56 billion, but has an $800-million standby for numerous infrastructure, including the Integrated Flood Risk Management Sector Project Phase 1. The standby loan also covers programs for upgrading the country’s technical and vocational education and training to the benefit of Filipino workers.
For 2022, the largest projects the government is seen to deliver through ADB loans are the Malolos-Clark Railway Project Tranche 2 and the Bataan-Cavite Bridge Project Tranche 1, both of which cost $1 billion.
In 2023 the ADB is eyeing to hand over the financing for the second tranche of the South Commuter Railway Project amounting to $1.25 billion. For that year, the Manila-headquartered multilateral is also looking to begin the initial construction of the $1 billion Laguna Lakeshore Roads Project.
According to Bird, the ADB will support the Philippine infrastructure and social projects to boost its chances of recovering from the economic impact of the Covid-19 pandemic.
The ADB has downgraded its economic projections for the Philippines, as it now expects GDP to shrink by 8.5 percent this year. On the other hand, it forecasts the country to rebound next year to the tune of 6.5 percent should the government carry on with its gradual reopening of business activities.
However, the ADB warned risks remain in 2021, especially with the continuing surge of the virus on a global scale, as well as with how the Philippines will implement its vaccination program.
