By Arjay L. Balinbin, August 30 2019; Business World
Image Credit to Reuters
PRESIDENT Rodrigo R. Duterte and Chinese President Xi Jinping on Thursday witnessed the signing of six bilateral agreements between the Philippines and China, including a $219-million loan for the Philippine National Railways (PNR) South Long Haul Project.
Finance Secretary Carlos G. Dominguez III and Export-Import Bank of China Vice President Xie Ping signed the agreement for a $219.78-million preferential buyer’s credit facility to fund the project management consultancy for the PNR South Long Haul.
The dollar-dominated loan has an interest rate of 2% per annum, with a 20-year maturity period and a seven-year grace period, the Department of Finance (DoF) said in a statement.
The PNR South Long Haul Project was among the 75 infrastructure flagship projects under the administration’s “Build, Build, Build” program, linking Metro Manila to Legazpi, Albay, Legaspi to Matnog in Sorsogon, and Calamba, Laguna to Batangas City.
The PNR’s project management consultancy covers the detailed engineering and design, preparation of the terms of reference, bidding documents, construction supervision, rolling stock and electromechanical system.
At the same time, Presidential Spokesman Salvador S. Panelo said other agreements signed by the Philippines and China included “cooperative measures and assistance in the key areas of education, science and technology, and economic growth, among others.”
These include memoranda of understanding (MoUs) on cooperation between Commission on Higher Education and Chinese Ministry of Education, and on science and technology between Department of Science and Technology and Chinese Ministry of Science and Technology.
There was also an exchange of notes on the cooperation procedure for the availment and utilization of concessional loan under a renminbi-denominated loan facility, signed by the Department of Foreign Affairs and China International Development Cooperation Agency.
Meanwhile, the Bureau of Customs (BoC) inked an implementation agreement with the Ministry of Commerce regarding the latter’s donation of four mobile X-ray container vehicle inspection systems and two luggage inspection systems to the Philippines.
The BoC also signed a separate accord with the General Administration of Customs of China that defines the guidelines on strengthening cooperation on customs matters between the two countries.
Trade Secretary Ramon M. Lopez said in statement that the bilateral meeting between the two leaders last Thursday had “focused on how we can advance peace and cooperation in many fields, like in trade and investments, infrastructure and finance, education, agriculture, science and technology, security, and working against transnational crimes and illegal drugs.”
Mr. Lopez said the Chinese President reiterated Beijing’s policy to help balance trade with the Philippines “by buying more goods especially agriculture and agri-based products and industrial goods.”
To date, Philippine exports to China have been growing at an average of 10% in the last three years, the Trade chief noted.
He added that China is “optimistic” in seeing more of its citizens visiting the Philippines.
“From only about 500,000 tourists from China in the Philippines in 2015, the number has increased to 1.2 million in 2018 and is expected to reach 1.5 million this year, helping boost the local economy,” Mr. Lopez said.
Mr. Duterte, described by Mr. Xi as his “old friend,” was on his fifth visit to China since he assumed office in 2016. It was also his eighth meeting with Mr. Xi.
The Philippine President was scheduled to attend the China Business Forum on Friday afternoon where he was expected to urge Chinese business leaders to invest in the Philippines.
“Chinese companies are also encouraged to invest in the Philippines to help increase jobs and production capacities that will enable the Philippines to enhance its exports capabilities,” Mr. Lopez said.
“The momentum of Chinese investments has been very positive as foreign direct investments (FDI) from China grew six times more in the last three years. More big-ticket projects are on the way especially in manufacturing both in heavy industries like petrochemical, iron and steel, as well as light industries like textile, construction, technology-based services, agribusiness, energy, power, transportation, infrastructure, and tourism,” he added. — Arjay L. Balinbin