Japan disburses 50B-yen Covid-19 response loan

The Japanese government has disbursed its 50-billion-yen (about P23.5 billion) Covid-19 (coronavirus disease 2019) Crisis Response Emergency Support Loan to the Philippines, the Department of Finance (DoF) announced on Tuesday.

In a statement, the Finance department said the loan, which aims to assist the government’s efforts to contain the Covid-19 pandemic and offer economic relief to Filipinos most affected by it, was disbursed on August 14, 44 days after the agreement on it was signed.

The loan, which became effective on August 11, was disbursed through the Japan International Cooperation Agency (JICA).

“We thank Tokyo and JICA 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,” Finance Secretary Carlos Dominguez 3rd was quoted as saying in the statement.

“This [loan] 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.

Given the Philippines’ need for budgetary support to address the crisis, it took less than a month to secure all documents necessary to declare the loan effective, the department said.

This is the quickest loan secured under Japan’s Official Development Assistance financing package and is in keeping with the “fast and sure” approach adopted by the two countries since 2017.

The Development Budget Coordination Committee approved the package on June 10. It 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.

It 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. It also forms part of the 2020 Gross Financing Program as revised in light of the Covid-19 response measures.

To be implemented by the Department of Health and the National Economic and Development Authority this year and the next, the loan would be used retroactively for the Covid-19 response efforts the government has exerted since April.

The loan would also help cover the budget expenditures the government already made or is about to be made.

Source: TheManila Times