The Philippines’ overall official development assistance (ODA) loan disbursements saw a significant increase in 2023, the National Economic and Development Authority (NEDA) said in a report, amid efforts toward post-pandemic recovery.
According to the 2023 ODA portfolio review report, the total actual disbursements from the active loans portfolio reached $6.11 billion in 2023 alone.
This translates to a 27- percent increase in combined program and project loan disbursements from 2022’s $4.83 billion.
“This growth continues a trend of rising loan disbursements that began in 2020 during the peak of the COVID-19 pandemic. Initially driven by quick-disbursing program loans supporting the government’s pandemic response, the subsequent increase in disbursements reflects the government’s shift towards focusing on post-pandemic recovery efforts,” the report said.
Cumulative disbursements from the 113 active loans amounted to $15.80 billion, which represents approximately 45 percent of the total net commitment of $35.07 billion.
Meanwhile, the overall obligation rate, or the ratio of cumulative obligations and cumulative allotment releases, of implementing agencies of ODA loan-funded projects reached 84.34 percent.
The overall disbursement rate or the ratio of cumulative disbursements and cumulative obligations reached 85.12 percent, which stood on par with the overall obligation rate.
The active ODA portfolio in 2023 amounts to $37.29 billion, comprising 113 loans totaling $35.07 billion and 325 grants worth $2.22 billion.
These were supported by 46 development partners and implemented by 132 partner agencies.
Japan reclaimed the largest share of ODA in the country with 32 percent, followed by the Asian Development Bank and World Bank.
Over a third of the portfolio is implemented nationwide in support of equitable growth across the archipelago, the report said.
The active ODA portfolio grew by 15 percent from $32.4 billion in 2022.
“This increase underscores ODA’s crucial role in supporting government interventions, especially in the context of economic recovery and sustained growth post-pandemic,” the report said.
NEDA secretary Arsenio Balisacan lauded this increase as a significant progress in the utilization of the ODA funds.
“This is a welcome opportunity as we boost the government’s capabilities and introduce crucial reforms to sustain our country’s socioeconomic progress. We assure the public that the government is maximizing the opportunity to utilize additional funding for economic recovery and infrastructure development under the administration’s Build-Better-More program,” Balisacan said.
The report showed the Philippines’ ODA includes 13 new program loans amounting to $6 billion and 17 new project loans worth $6.08 billion.
Among the new program loans is a $1-billion allocation for the Post-COVID-19 Business and Employment Recovery Program, an initiative that aims to stimulate job creation and economic growth, both of which were severely affected by the pandemic.
The ODA portfolio also encompasses efforts to modernize the country’s financial systems to promote economic development and inclusivity.
In addition, the country secured 57 new ODA grants totaling $240.53 million in 2023.
These grants are designed to enhance the capacities of the government and local stakeholders in public service delivery and in addressing the country’s developmental challenges, such as inequitable growth, vulnerability to natural disasters, lacking access to education, and limited innovation, among others.
“We have made significant progress in securing and utilizing our funding sources. We are committed to ensuring that these funds are efficiently spent by addressing critical challenges such as procurement delays and problems in right-of-way acquisitions,” Balisacan said.
“This underscores the need for a whole-of-government approach, coupled with assistance from our other development partners, to implement strategic interventions and enhance our project management practices,” he added.
To address these challenges, NEDA recommends the following interventions: strengthening agency capacities in procurement to ensure that processes are conducted efficiently and in compliance with relevant legal frameworks and policies; and leveraging the Real Property Valuation and Assessment Reform Act to help resolve property valuation disputes and streamline site acquisition processes.
The recommendation also includes ensuring the alignment of agencies’ budget requests with Department of Budget and Management guidelines and ensuring that proposals are thorough and submitted on time; and enhancing coordination efforts among implementing agencies, development partners, local government units and stakeholders to secure the timely approval of permits and certificates.
