MANILA – The Philippine government’s emergency budget got further support Tuesday after the signing of a 50 billion yen or about PHP23.3-billion quick-disbursing loan facility with Japan, through the Japan International Cooperation Agency (JICA).
Finance Secretary Carlos Dominguez III said the loan agreement, which is the second phase of the Post-Disaster Stand-by Loan (PDSL), “exemplifies the arrangements we require to reinforce our financial resilience.” “Of course, we hope we will never need to quickly disburse from this loan package. But its availability assures us that we will have ample ammunition to support our budgetary needs in the event a crisis happens. This facility is an important element of our overall resilience,” Dominguez said in his speech during the signing ceremony covered virtually by journalists. Initially, PDSL funds may be released if there is a need to address the impact of an earthquake or other disasters but the Japanese government has expanded the trigger events to include health crises, such as the one caused by the coronavirus disease 2019 (Covid-19) pandemic. Dominguez said the stand-by funds may be released in tranches within three years but may be extended up to four times. The 40-year loan, which has a grace period of 10 years, has a fixed interest of 0.01 percent. Dominguez said the pandemic underscores the need to further improve the country’s policy and institutional framework for disaster risk reduction and management. “It likewise emphasizes the need to build our financial resilience against disasters and similar emergencies. The ability to mobilize financial resources without delay is essential to emergency preparedness,” he said. In a virtual briefing after the signing ceremony, Dominguez said he has been assured by Japanese Ambassador to the Philippines Koji Haneda that the Philippines-Japan relations will remain the same despite the resignation of Japanese Prime Minister Shinzo Abe, who stepped down because of health problems. “He also mentioned that the policies of the incoming Prime Minister (Yoshihide Suga) are going to be very consistent with the policies that have been enunciated and pursued by Prime Minister Abe,” he said. Dominguez said Suga “is very experienced in government, having been the Chief of Cabinet for many years.” “So we were assured that the policies that were enunciated and pursued by Prime Minister Abe will continue. It bodes very well for our relationships with the Philippines and Japan,” he added.