FINANCE Secretary Carlos G. Dominguez III urged the world’s major multilateral development banks (MDBs) to cooperate in mobilizing financing for climate adaptation and mitigation initiatives of emerging economies like the Philippines.
In his recent meetings with the officials from the World Bank Group (WBG), Dominguez said the trilateral cooperation among MDBs, particularly among the WBG, Asian Development Bank, and the Asian Infrastructure Investment Bank, would present a more feasible and accessible option for climate financing for emerging economies instead of going through the tedious process imposed by various organizations.
Dominguez made the remark on the sidelines of the 2022 International Monetary Fund-WBG Spring Meetings in Washington, D.C. in United States.
Finance Undersecretary Mark Dennis Joven, who heads the department’s International Finance Group, also pointed out in a meeting with WBG Regional Vice President for East Asia and the Pacific Manuela Ferro that main institutions for climate finance such as the UN Framework Convention on Climate Change (UNFCCC)’s Green Climate Fund and the Adaptation Fund are not working together with the MDBs.
Joven lamented the lost potential in reaching more countries that are in need of funding assistance for their climate projects.
Nonetheless, Dominguez thanked the multilateral development banks for entering
into a co-financing agreement for the Philippines Covid-19 vaccination program, which also provided the government the budgetary support it needed at a time when revenue collections were down as a result of the pandemic-induced lockdowns or community quarantines.
The trilateral collaboration among the three MDBs in supporting the Philippines’s Covid-19 response was an offshoot of a proposal broached by Secretary Dominguez in 2017 for multilateral institutions to coordinate with each other in eliminating overlapping functions, reducing costs, and being more effective and responsive in providing official development assistance (ODA) to member-countries, the Department of Finance said.
On behalf of the Philippine government, Dominguez personally thanked Ferro and other key officials of the institution for the WBG’s support of the Duterte administration’s reform agenda and pandemic response efforts.
In a separate meeting with WBG Vice President and Managing Director for Operations Axel Van Trotsenburg, Dominguez also expressed Manila’s appreciation for WBG’s assistance.
In response, Trotsenburg thanked Dominguez for his “great leadership and cooperation,” which ensured that the WBG was able to play a useful and effective role in extending support to the Philippines.
Trotsenburg added that global solidarity is the key to addressing the widening inequalities between rich and low-income countries that were further triggered by the pandemic.
The WBG, in particular, has signed 22 loan agreements with the Philippines with the Duterte administration, for a total $7.53 billion. Fifteen of these 22 agreements were for an aggregate amount of $6.15 billion and went to the government’s Covid-19 response program.
Ferro assured Dominguez that the WBG will continue helping the Philippines’s economic recovery in the next administration. She noted that WBG’s partnership with the Philippines helped accelerate the Covid-19 vaccination program, which led to the reopening of the economy and the return to face-to-face classes in many schools.
Dominguez agreed with Ferro that the Russia-Ukraine war would bring headwinds to the economic recovery of the Philippines and the rest of the world as prices of crude oil and food continue to rise.
To further open the country to foreign investors and bring in the capital needed to create more jobs and reinvigorate the economy amid the conflict, Dominguez listed the three economic liberalization laws passed by the Philippines—the amendatory measures to the Foreign Investments Act, Retail Trade Liberalization Act, and Public Service Act.
Socioeconomic Planning Secretary Karl Kendrick Chua of the National Economic and Development Authority said these liberalization measures, along with the Corporate Recovery and Tax Incentives for Enterprises (CREATE) Law that reformed the fiscal incentives system, will fuel the growth of the services sector in the Philippines.