(Eagle News)–The Philippines and the Asian Development Bank have signed a $400-million loan agreement that aims to help boost domestic capital markets amid the COVID-19 pandemic.
The Department of Finance said the loan for the Support to Capital Market Generated Infrastructure Financing, Subprogram 1 (SCMGIF1) is set for accelerated disbursement this year.
The loan is expected to be effective by June 10 and be fully disbursed by June 15, with a maturity period of 15 years inclusive of a 3-year grace period.
According to the DOF, the amount is expected to boost the domestic capital markets’ capability to increase the supply of long-term finance to support investments by allowing the government to fund infrastructure at lower relative costs; and enabling the private sector to fund infrastructure through the capital markets.
“This program will support the Philippine government’s development goals, including its response to the COVID-19 pandemic,” ADB Vice President Ahmed Saeed said.
Finance Secretary Carlos Dominguez III and ADB Country Director for the Philippines Kelly Bird signed the loan agreement on Thursday, June 4.
The loan is the latest funding package extended by the ADB to the Philippines so far this year.
The ADB earlier signed a $1.5-billion loan accord with the Philippines for the COVID-19 Active Response and Expenditure Support Program and an agreement for the $200 million second additional financing for the Social Protection Support Project.
All in all this year, the total lending package to the Philippines by the ADB has reached $2.1 billion.