USD62-M China-PH irrigation project screened before approval: DOF

“The said project has gone through a robust Investment Coordinating Committee approval process,” Finance Assistant Secretary Tony Lambino said. (File Photo: Wilson Lee Flores/Facebook)

MANILA — The Department of Finance (DOF) on Thursday assured the public that the Chinese-funded USD62.09-million Chico River Pump Irrigation Project in northern Luzon was properly screened by the Investment Coordination Committee (ICC), which consists of key Cabinet secretaries.

“The said project has gone through a robust Investment Coordinating Committee approval process,” Finance Assistant Secretary Tony Lambino said.

“The loan agreement was reviewed, negotiated, and approved by the Interagency Committee composed of the Justice Department, BSP (Bangko Sentral ng Pilipinas), and DOF,” he added.

The statement came after former lawmaker Neri Colmenares described the loan agreement as “one-sided” in favor of China.

Lambino said the financing terms of the irrigation project in the Cordillera region are concessional at 2 percent for a 20-year period, inclusive of a seven-year grace period.

The project, upon completion, would water about 8,700 hectares of agricultural land and benefit more than 4,300 families in the provinces of Kalinga and Cagayan.

On procurement, he said China has provided “a list of three contractors of good standing” and the implementing agency was given the opportunity to vet and request a replacement, if needed.

And even before the negotiation and after the signing of the loan agreement, the BSP’s policy-making body, the Monetary Board, “also approved the terms of the loan for the Chico River Project,” Lambino said.

He reiterated that the country is managing its public debt “very responsibly.”

“In 2018, our debt-to-GDP ratio was estimated at 41.9 percent, lower than the programmed 42.1 percent. This means we are able to pay our bills,” Lambino said.

At the same time, he pointed out that the project debt to China is but a fraction of the country’s project debt to Japan.

“The numbers also reflect the fact that we have been borrowing from Japan for a longer time. By 2022, project debt to China is estimated to be at around 4.5 percent of total debt. Project debt to Japan will be around 9.5 percent of total debt,” he said.

The Chico River irrigation project broke ground on June 8, 2018.