No loans needed: Think tank says ditch infra projects for virus response
MANILA, Philippines – The government is set to borrow billions to fund the battle against the coronavirus, but a think tank said President Rodrigo Duterte just needs to ditch some infrastructure projects and get funds from there.
IBON Foundation executive director Sonny Africa said in a Rappler Talk interview that Duterte has at least P975 billion worth of infrastructure projects in the 2020 General Appropriations Act, excluding unspent funds in 2019. At least one-fourth can be discontinued, according to Africa.
"Maraming infrastructure projects ay hindi na magiging viable, hindi lang dahil sa lockdown, kundi dahil na rin sa pandemic," Africa said.
(There are many infrastructure projects that may no longer be viable, not just because of the lockdown, but also because of the pandemic.)
Africa argued that feasibility studies for some infrastructure projects, particularly those geared towards promoting tourism, were done before the pandemic and may no longer give back intended returns.
Africa said the National Economic and Development Authority (NEDA) now has to quickly and carefully choose which projects to discontinue.
He said that one tourism-related infrastructure project that can be shelved is the P14.97-billion Pasacao-Balatan Coastal Tourism Highway in Camarines Sur. The 40-kilometer highway was approved by the NEDA Board in October 2019.
IBON Foundation earlier urged the government to spend P296 billion monthly to support millions of poor families affected by the lockdown.
Duterte had been given special powers by Congress, including the ability to realign funds.
The government is tapping special purpose funds and dividends from government owned and controlled corporations to fund coronavirus-related programs
Africa cautioned against loans from multilateral lenders like the World Bank for its interest rates and history of pushing for privatization of health care in the country, which has supposedly led to the health sector's problems today.
Finance Secretary Carlos Dominguez III said in several interviews that they are set to borrow $1 billion.
So far, the Bangko Sentral ng Pilipinas (BSP) has bought P300 billion worth of government securities to inject cash into the government's war chest.
Treasury borrowings amounting to P190 billion, as well as interest rate and reserve requirement cuts by the BSP, also helped boost funding amid expected revenue shortfalls. – Rappler.com