Philippines working to clear debts
The Philippines has signaled intent to repay a $593 million loan from China disbursed for the halted Northrail project, government officials announced on September 24. The commitment made by the Filipino cabinet to return the funds in installments over the next two years is being seen as an action that the Board of Investment hopes will allay some fears held by foreign investors.
The 80-kilometer Northrail project originally planned to link Metro Manila with the Diosdado Macapagal International Airport in Clark, Pampang, was suspended in March 2010 due to problems in the procurement process.
In addition, funding from China to the Philippines was abruptly cut off recently due to the simmering dispute over rival claims to the Scarborough Shoal in the West Philippine Sea (South China Sea).
“In the middle of the controversy, China suddenly called off its overseas development assistance that they lent us for the Northrail project,” BusinessWorld quoted Local Government Secretary Manuel Roxas II as saying yesterday after a meeting with Chinese Vice-President Xi Jinping and Foreign Affairs Minister Fu Ying last week.
Officials have continued to assure lenders of the Philippine’s financial health, pointing to solid growth and an active stock market. Capital gross international reserves will reach $79 billion this year, according to statistics from the Philippine Board of Investment.
“We have the money and we can pay this [loan]. According to Secretary Cesar Purisima of the Finance Department, they have started negotiations to pay this in installment over the next two years,” Roxas said.
Resolving the festering six-year legal case over the expropriated German-built main airport terminal in Manila will also have to be settled if the country is to encourage foreign direct investment.
The Filipino court confirmed in May that $176 million in compensation will be repaid to its German-Filipino contractors, not the $846.43 originally demanded.
By the end of 2010, the Philippines had $60 billion in external debt, or 31.8 per cent of its GDP.
[caption id="attachment_4680" align="alignleft" width="300"] Artist's impression of the halted Northrail project in the Philippines[/caption] The Philippines has signaled intent to repay a $593 million loan from China disbursed for the halted Northrail project, government officials announced on September 24. The commitment made by the Filipino cabinet to return the funds in installments over the next two years is being seen as an action that the Board of Investment hopes will allay some fears held by foreign investors. The 80-kilometer Northrail project originally planned to link Metro Manila with the Diosdado Macapagal International Airport in Clark, Pampang, was suspended in March...
The Philippines has signaled intent to repay a $593 million loan from China disbursed for the halted Northrail project, government officials announced on September 24. The commitment made by the Filipino cabinet to return the funds in installments over the next two years is being seen as an action that the Board of Investment hopes will allay some fears held by foreign investors.
The 80-kilometer Northrail project originally planned to link Metro Manila with the Diosdado Macapagal International Airport in Clark, Pampang, was suspended in March 2010 due to problems in the procurement process.
In addition, funding from China to the Philippines was abruptly cut off recently due to the simmering dispute over rival claims to the Scarborough Shoal in the West Philippine Sea (South China Sea).
“In the middle of the controversy, China suddenly called off its overseas development assistance that they lent us for the Northrail project,” BusinessWorld quoted Local Government Secretary Manuel Roxas II as saying yesterday after a meeting with Chinese Vice-President Xi Jinping and Foreign Affairs Minister Fu Ying last week.
Officials have continued to assure lenders of the Philippine’s financial health, pointing to solid growth and an active stock market. Capital gross international reserves will reach $79 billion this year, according to statistics from the Philippine Board of Investment.
“We have the money and we can pay this [loan]. According to Secretary Cesar Purisima of the Finance Department, they have started negotiations to pay this in installment over the next two years,” Roxas said.
Resolving the festering six-year legal case over the expropriated German-built main airport terminal in Manila will also have to be settled if the country is to encourage foreign direct investment.
The Filipino court confirmed in May that $176 million in compensation will be repaid to its German-Filipino contractors, not the $846.43 originally demanded.
By the end of 2010, the Philippines had $60 billion in external debt, or 31.8 per cent of its GDP.
