Philippines, South Korea sign P9-B loan deal for Cebu container port
MANILA, Philippines (UPDATED) – South Korea formally agreed to provide a P9.1-billion loan for the construction of a new container port for Cebu during President Rodrigo Duterte's visit to Seoul.
The loan agreement, worth P9.1 billion ($172.64 million), was signed by Finance Secretary Carlos Dominguez III and Export-Import Bank of Korea president and chairman Eun Sung-soo on Monday, June 4.
The signing was witnessed by Duterte and South Korean President Moon Jae-in.
The loan will impose an interest rate of 0.15%, payable over 40 years, with a 10-year grace period, said Dominguez on Tuesday, June 5, during a press briefing.
"It is very, very generous of the Korean government and certainly we can afford this because when you put the port, we will be charging port charges and goods will flow more quickly," he said.
The new loan is part of the $1-billion official development assistance (ODA) that South Korea committed last May to provide to the Philippines.
Dominguez said the new container port is good news for the Visayas' economy as it will increase the operational capacity of Cebu's main cargo way.
"It will help alleviate the road congestion in the Cebu base port area and provide a more efficient and reliable transport infrastructure to enhance the flow of goods and services in the Visayas," said Dominguez.
More infrastructure projects
On Tuesday, Dominguez said that, during bilateral talks between Filipino and South Korean officials on Monday, it was decided that 3 projects would be funded by the $1-billion arrangement.
They are the following:
- $50 million for a Project Preparation Facility for the National Irrigation Administration
- $100 million for the New Dumaguete Airport
- $41 million for the implementation of the Electronic Receipt Invoices and Sales Reporting System to monitor taxes paid by Philippine retailers
The balance of $635 million will likely be used to fund two or 3 flagship projects of the Duterte administration's Build, Build, Build infrastructure program.
The other documents that were signed during Duterte's trip to South Korea are the following:
- Memorandum of Understanding for Cooperation on the Expansion of Renewable Energy Deployment between the Department of National Defense (DND) of the Philippines and the Ministry of Trade, Industry and Energy (MOTIE) of Korea
- Memorandum of Understanding between the Department of Transportation (DOTr) of the Philippines and the Ministry of Land, Infrastructure and Transport (MOLIT) of Korea Concerning Cooperation in the Field of Transport
- Memorandum of Understanding on Scientific and Technological Cooperation between the Department of Science and Technology (DOST) of the Philippines and the Ministry of Science and ICT of Republic of Korea
- Memorandum of Understanding between the Department of Trade and Industry (DTI) of the Philippines and the Ministry of Trade, Industry and Energy (MOTIE) on Trade and Economic Cooperation
- Memorandum of Understanding on cooperation in the field of broadcast between Presidential Communications Operations Offices (PCOO) and Ministry of Culture, Sports and Tourism
P52.53 = $1