ASEAN KEY DESTINATIONS
Philippines may raise $4.6 billion for infrastructure
The Philippines government plans to raise as much as 200 billion pesos (US$4.6 billion) from state-run financial institutions to help fund roads, railways and ports, Economic Planning Secretary Cayetano Paderanga said.
“We want to tap the liquidity in the domestic market and avoid currency risks,” Paderanga said in an interview on March 12 in Cagragay Island in Luzon, where he spoke before a group of Philippine fund managers. The Asian Development Bank is advising the government on creation of the fund, he said.
National Development Co., the country’s investment agency, will probably issue debt to state-owned Development Bank of the Philippines, Land Bank of the Philippines, the Government Service Insurance System and the Social Security System to create the fund, Paderanga said. The four financial institutions may, in turn, also sell securities, he added.
The Southeast Asian nation will ask private industry to build $1 billion worth of roads and railways starting this year, to help meet a growth target of as much as 8 percent.
Budget deficits in 22 of the past 26 years have limited government spending on infrastructure, prompting President Benigno Aquino to start a $16 billion five-year development plan to bolster investment.
The government may make funding of as long as 25 years available to approved infrastructure projects, Paderanga said. National Development may start issuing bonds this year and will raise funds only when needed, he said.
Development Bank plans to sell $300 million of dollar bonds, President Francisco Del Rosario said March 7.
The infrastructure being lined up won’t immediately bolster growth “but it will help achieve sustainable expansion on the longer term,” Paderanga said.
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