The Japan International Cooperation Agency (Jica) and the Land Bank of the Philippines (LandBank) launched a P2.12-billion relending facility for farmers and small and medium enterprises in the Autonomous Region in Muslim Mindanao (ARMM) and conflict-affected areas in Mindanao (CAAM).
The facility called “HARVEST” stands for Harnessing Agribusiness opportunities through Robust and Vibrant Entrepreneurship Supportive of peaceful Transformation.
The five-year relending facility will give private enterprises access to a credit line with LandBank for their capital investments, operations, expansion initiatives and agriculture-related projects that support agri-related economic activities in the region.
“By improving access to finance and stimulating economic activities, the cooperation aims to help create jobs, improve living standards and contribute to peace building,” said Jica Philippines Senior Representative Yo Ebisawa.
“Giving them access to finance will help sustain job creation and raise their productivity through equipment and trainings, while also boosting the region’s agro-industry sector,” he added.
The facility is financed by an official development assistance (ODA) from Jica to provide concessional loans to small and medium enterprises, corporatives (plantation farm management services), large agribusiness enterprises, cooperatives and participating financial institutions in ARMM and other conflict-affected areas.
Under the program, Jica will provide human-resource training and technical assistance to LandBank, agriculture cooperatives and other participating institutions.
Aside from financial support, availers of loans under the HARVEST Project will also be provided with technical assistance in the form of capacity-building trainings, seminars and market linkage initiatives.
“Through this investment opportunities in agribusiness, we hope to help fuel growth in a region beleaguered by decades-old conflict and ultimately uplift the quality of lives of our fellow Filipinos in these communities,” LandBank President and CEO Alex V. Buenaventura said.
In the Philippines farmers remain one of the country’s poorest sectors with poverty incidence as high as 34.3 percent, based on a 2015 report released by the Philippine Statistics Authority. Situations are worse in conflict-affected areas.
LandBank and Jica signed the loan agreement for the HARVEST Project on January 12, 2017, with Japan Prime Minister Shinzo Abe and Philippine President Duterte leading the bilateral signing ceremony held at Malacañan Palace.
Japan is the Philippines largest source of ODA financing. In 2017 total ODA from Japan amounted to $6.16 billion or 39.89 percent of total ODA during the period.
The assistance from Japan includes $6.01 billion worth of loans and $157.07 million in grants. The total ODA received by the Philippines last year was $15.45 billion.