The Philippines became the first recipient of Japan’s emergency support loan for coronavirus disease 2019 (COVID-19) affected economies, with the early disbursement on Friday of its 50-billion yen financing package, the Department of Finance (DOF) said in a statement yesterday.
On behalf of the Philippine government, Carlos Dominguez, DOF secretary, thanked Japan for disbursing the 50-billion COVID-19 Crisis Response Emergency Support Loan (CCRESL), in a record period of only 44 days after the signing of the agreement on this assistance package last July 1.
“We thank Tokyo and JICA (Japan International Cooperation Agency) for the release in record time of this emergency support loan for the Duterte administration’s COVID response that has made the Philippines the first recipient of Japan’s assistance program for economies battered by the coronavirus-induced global health and economic crisis,” Dominguez said.
“This underscores the strong partnership between Japan and the Philippines under the Duterte presidency and the top priority that the Japanese government has given to our country as its development partner, especially at this time of the COVID-19 pandemic,” he added.
The CCRESL became effective on August 11 and was quickly disbursed by the Japanese government through JICA after only three days, the DOF said.
Despite the restrictions resulting from the quarantines imposed to curb the spread of COVID-19, officials of both countries were able to speed up the process of making the loan effective and ready for disbursement, Dominguez said.
Given the Philippines’ urgent need for budgetary support to address the COVID-19 emergency, it took only less than a month to secure all the documents necessary for the declaration of the effectiveness of the 50-billion yen CCRESL.
The DOF said this is the quickest loan that was ever secured under Japan’s official development assistance financing package.
Dominguez underscored the importance of the loan in helping the government cover its budget expenditures through additional borrowings to beat the pandemic and fund its economic recovery program.
The CCRESL package carries concessional lending terms of 0.01 percent fixed interest rate per annum with a maturity period of 15 years inclusive of a four-year grace period.
The CCRESL from Japan is designed as a co-financing operation complementing the Asian Development Bank’s COVID-19 Active Response and Expenditure Support Program alongside prospective loans from other development partners, and will form part of the 2020 gross financing program as revised in light of COVID-19 response measures, the DOF said.
To be implemented from 2020 to 2021 by the Department of Health and the National Economic and Development Authority, the CCRESL will be utilized retroactively for the government’s COVID-19 response efforts undertaken since April 2020.
The loan will also help cover the budget expenditures already made or about to be made by the government.