Palace defends USD400M World Bank loan

Posted at 08/07/14 9:38 AM

MANILA - Malacanang defended Wednesday the Aquino administration's $400 million loan from World Bank to fund the conditional cash transfer (CCT) or Pantawid Pamilyang Pilipino Program (4Ps).

Presidential Spokesperson Edwin Lacierda said the loan has given the Aquino administration much-needed elbow room to push economic reforms, not just for the CCT.

"So this doesn't limit itself to just the CCT. Because of the fiscal space, the prudent fiscal management of the country, we’re able to do a lot of poverty interven[tion]—anti-poverty interventions. And for that particular reason, we’re able to lift up the concern—lift up the welfare of the poorest of the poor," he said.

Lacierda said the Aquino administration's fight against poverty is an ongoing process and will not finish in 2016.

"Our resolve to ensuring that we spend the money wisely, we spend on things that needed to be spent on, on social programs," he said.

The loan, payable until 2035, was given a red flag by critics.

Freedom from Debt Coalition (FDC) executive director Milo Tanchuling said in a news article written by the Philippine Center for Investigative Journalism (PCIJ) that poor Filipinos in the future will be the ones who will carry the burden of paying off this debt.

FDC believes it would be better if the CCT relied on locally sourced funds.

But Lacierda believes that the loan has given the Aquino Administration fiscal space.

"That’s the reason why we’re able to do what we’re doing right now. We’re in a capa[city]… We’re in a position to provide all these concerns, provide all these needs because we have the fiscal space. We have ratings upgrade, which allowed us to borrow at concessional rates, at preferential rates," he said.