The Asian Development Bank (ADB) has granted the Philippines a total of $650 million or around P34.32 billion in loan commitments to support the country’s climate change adaptation and mitigation programs and to strengthen domestic capital markets, the Climate Change Commission (CCC) announced on Wednesday.
Department of Finance Secretary and Climate Change Commission (CCC) Chair-Designate Carlos G. Dominguez and ADB Deputy Director General Winfried Wicklein exchanged loan documents for the Climate Change Action Program 1 (CCAP1) and Capital Market-Generated Infrastructure Financing Program, Subprogram 2 (CM-GIF2) in a ceremony held last Friday.
The CCAP1, amounting to $250 million, is the ADB’s first climate change policy-based loan program. It recognizes the Philippines as a pioneer in climate policy development finance and encourages other nations to design their own multi-sector climate programs.
In a news statement, the CCC said the program demonstrates the Philippines’s commitment to provide long-term attention to the climate crisis, which has had a significant impact on the country. The Philippines has taken the initiative to be one of the first Asia-Pacific countries to implement climate- change policies.
“We owe it to the Filipino people to build the nation’s resiliency against climate change. We cannot wait for the industrialized economies to break their inertia and accept the urgency of reducing greenhouse gas emissions and providing climate finance to vulnerable countries,” Dominguez stressed.
Meanwhile, the CM-GIF2, amounting to $400 million, supports the government’s initiative of funding infrastructure at a lower relative cost and connecting private sector infrastructure to capital markets.
It builds on the accomplishments of Subprogram 1, which intended to increase the availability of long-term finance to support investments, as well as the ADB’s decades-long engagement in the Philippines’s capital market.
Meanwhile, CCC Secretary Robert E.A. Borje welcomed the initiative, emphasizing that support for the Philippines’s climate change adaptation and mitigation programs is key to ramping up national resiliency.
Borje also stressed the importance of bilateral cooperation and climate finance to enable developing and vulnerable countries to further strengthen the adaptive capacities of developing countries and sustain economic growth and development.
The ADB’s policy-based lending modality, which not only mobilizes funding for continued Covid-19 response obligations, but also supports green, resilient, and inclusive development in key priority sectors, bolsters the country’s post-pandemic growth momentum.
“We, at the ADB, are honored and proud to partner with the Philippines, to partner with you, including also through these difficult times in the pandemic. We are fully committed to supporting the Philippines and improving the livelihoods of all the Filipinos and creating a stronger, green, and resilient economy,” said Deputy Director-General Wicklein.
“The two programs are not unrelated. An improved infrastructure backbone will increase the efficiency of our economy. It will enable us to improve our climate resiliency and spur sustainable growth,” said Dominguez.
Officials and representatives from the Department of Agriculture, Securities and Exchange Commission, Insurance Commission, Philippine Crop Insurance Corporation, Social Security System, Bangko Sentral ng Pilipinas, Department of Environment and Natural Resources, Laguna Lake Development Authority, and the Climate Change Commission, represented by Commissioner Rachel Anne S. Herrera, were present in the ceremony.