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BSP approves 230-M euro loan for govt road projects

abs-cbnNEWS.com | 12/01/2008 3:32 PM

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The Bangko Sentral ng Pilipinas (BSP) has approved loans worth nearly 230 million euros from Spanish bank BNP Paribas to fund the government's infrastructure projects that are needed to pump-prime the economy.

BSP governor Amando Tetangco said the Monetary Board has approved the loans "in principle" to finance part of the Arroyo administration's bridge program in agrarian reform areas.

According to him, BNP Paribas would extend the Japanese yen equivalent of 195 million euros, which would carry a 13-year maturity and a three-year grace period, and another yen equivalent of 34 million euros, with 6.5-year maturity and 1.5 years grace period.

But Tetangco said that subject to the terms of the loans, only bridges connecting to existing roads would be funded.

Tetangco said some of the previous bridge projects that were financed by national government loans were stand-alone and did not connect roads together.

"So now the condition in these loans is that if there is no pre-existing road, the bridge funding would not be granted," Tetangco said.

Tetangco noted that the agrarian reform bridges project would be implemented by the Department of Agrarian Reform, with the national government as the borrowing entity.

Tetangco said the Monetary Board also approved a $10-million loan from the World Bank’s International Bank for Rural Development that would be spent for the completion of about 22 small irrigation projects nationwide.

Also approved in principle were two official development assistance loans, including the 10 million euros from Germany's Kreditanstalt für Wiederaufbau  Bankengruppe and another $18.8 million from the International Fund for Agricultural Development.

as of 12/01/2008 3:32 PM