The Department of Agriculture (DA) said it is set to sign in July the $1-billion Philippine Sustainable Agricultural Transformation (PSAT) loan program with the World Bank.
PSAT is a five-year initiative that seeks to strengthen the country’s agri-fishery sector.
When the loan documents have been signed, PSAT will be carried out in August, DA Secretary Francisco Tiu Laurel Jr. said in a statement released on Tuesday.
DA Undersecretary Arnel De Mesa said in an interview yesterday the project proposal will be submitted to the Department of Finance (DOF) next week.
De Mesa said the project loan is subject to disbursement-linked indicators (DLIs), or results that the Philippines has to meet.
Each indicator is equivalent to a certain amount, which will be released to the Philippine Treasury once met, De Mesa said.
Tiu Laurel said he met with World Bank officials led by country director Zafer Mustafaoglu on February 10.
The meeting reviewed the progress and key aspects of the PSAT, the first project under the Bank’s Program-for-Results (PforR) financing framework.
Tiu Laurel said Mustafaoglu reaffirmed the World Bank’s commitment to signing the PSAT loan program.
The signing in July will coincide with President Ferdinand Marcos Jr.’s fourth State of the Nation Address.
The DA said the program involves climate-responsive strategies, policy reforms, diversification and enhanced fiscal management.
De Mesa said the DA has committed to certain indicators such as the issuance of an administrative order (AO) that diversifies the country’s rice areas, or an AO that limits the seeds to be used by farmers to ensure crops are dried properly.
PSAT aims to improve the efficiency of government spending while ensuring sustainable outcomes by building institutional capacity and strengthening governance, it said.
Tiu Laurel assured the World Bank of continued collaboration to ensure the success of PSAT and contribute to the country’s agricultural development and food security goals.
“This multi-year loan from the World Bank will provide us with the critical resources needed to advance the government’s food security agenda and promote sustainable agriculture—key drivers of development in the countryside that will uplift the lives of millions who depend on farming and fishery,” Tiu Laurel said.
Tiu Laurel and Mustafaoglu also discussed the Technical Assistance for Sustainable Agricultural Transformation (TASAT), a $15-million grant funded by the United Kingdom. TASAT will support the DA in implementing the PSAT by enhancing internal audits, evaluating resource use alternatives, assessing sectoral transformation, and expanding the availability of improved planting materials for high-value crops.
This supplementary funding, processed through the Philippine government system, will have to be endorsed by the Department of Finance and the National Economic and Development Authority through the Development Budget Coordination Committee. Irma Isip
