Gov’t secures $13.3B for pandemic response from foreign sources

After securing $13.36 billion in loans and grants from foreign sources to finance its pandemic response last year, the government is now seeking to raise $1.46 billion (P70 billion) from multilateral agencies to fund the country’s coronavirus disease 2019 (COVID-19) vaccination programs.

The Asian Development Bank has approved $3.93 billion worth of loans and $8 million in grants for the government’s pandemic response as of Dec. 15, according to the Department of Finance (DOF) .

Meanwhile, the World Bank granted $2.27 billion in loans, while the Asian Infrastructure Investment Bank provided another $750 million.

The Japan International Cooperation Agency also extended credit worth $458.95 million with the DOF, as part of the second phase of the Post-Disaster Standby Loan to the Philippines. Another $458.95 million worth of financing was provided to support the country’s COVID-19 Crisis Response Emergency Support program in the third quarter of 2020.

Separately, Japan disbursed an $18.36-million grant aid meant to boost the Department of Health’s medical equipment.

The Philippines secured financing worth $276.2 million from the L’Agence Française de Développement (APD) of France, and $100 million from the Korean Export-Import Bank–Economic Development Cooperation Fund (KEXIM-EDCF).

The national government has raised $5.1 billion via the issuance of dollar-denominated global bonds in April and December last year.

The DOF is now working to secure $1.8 billion or P70 billion from various sources such as multilateral lenders, bilateral partners, and the domestic market for the procurement of vaccines to inoculate at least 50 million Filipinos.

“We will fully recover from this crisis once a safe and effective vaccine becomes available to us, on the strength of our enduring macroeconomic fundamentals,” Finance Secretary Carlos G. Dominguez III said in a statement on Friday.

The government has set aside P82.5 billion for the COVID-19 vaccination program, of which P12.5 billion will be sourced through the P10 billion allocated for vaccine procurement under the Republic Act (RA) No. 11494 or the Bayanihan to Recover as One Act and P2.5 billion will come from the Health department’s 2021 budget.

Mr. Dominguez said the P4.5-trillion 2021 national budget is the “most important and largest stimulus for the country’s road to recovery and will be crucial to attain the government’s 6.5% to 7.5% growth target for the year.

“Our strong macroeconomic fundamentals—the products of President [Rodrigo R.] Duterte’s hard-won policy battles—make us hopeful that the pain brought about by this coronavirus crisis will be short and our recovery will be strong,” Mr. Dominguez said.

The country’s economy shrank 10% in the first nine months of 2020 due to the impact of the pandemic, with the full-year economic contraction seen at 8.5-9.5%. — Luz Wendy T. Noble