MINDANAO will remain at the “front and center” of the Duterte administration’s “Build, Build, Build” program as the Department of Finance (DOF) has managed to secure highly concessional funding support for infrastructure and peace-building projects in the South despite the pandemic-induced crisis, Secretary Carlos Dominguez III said Thursday, September 10, 2020.
Among these projects for which the DOF has recently sealed loan agreements and grants are the second phase of the Davao City Bypass Construction Project and programs to assist the government in its ongoing peace-building and development efforts in Mindanao, including the ongoing confidence-building initiatives in the Bangsamoro Autonomous Region in Muslim Mindanao (Barmm) and the recovery and rehabilitation efforts for Marawi City, he said.
“Together with the hundreds of road, railway, port and irrigation projects all over Mindanao, these investments will support job creation, strengthen inclusive and sustainable growth, and promote lasting peace in the region,” Dominguez said in his videotaped message at this morning's opening of the 29th Mindanao Business Conference and Sulong Pilipinas-Mindanao session held online via Zoom.
The PCCI, led by Ambassador Benedicto Yujuico, organized both these virtual events in partnership with the DOF.
“These projects also demonstrate the administration’s commitment to move Mindanao from the margins and transform it into the center of agriculture and industry,” Dominguez added.
On June 16, the Philippines and Japan signed the loan agreement for the supplemental financing of P18.5 billion (JPY35 billion) for the Davao City Bypass Construction Project.
Dominguez, who had signed the accord on behalf of the Philippine government, said this bypass project is expected to be operational by 2023.
The project involves the construction of a 45.5-kilometer four-lane bypass road from Barangay Sirawan in Toril, Davao City to Barangay J.P. Laurel in Panabo City.
The usual travel time between these two points of 1 hour and 44 minutes via the Maharlika Highway is expected to be reduced to 49 minutes once the bypass road is opened to motorists.
Aside from the bypass road, the project also includes a 2.3-kilometer mountain tunnel that directly connects Barangay Matina Biao and Barangay Waan in Davao City, reducing travel time between the said points to less than 5 minutes from the usual 44 minutes when passing through local roads.
Advanced Japanese know-how and technology will be adopted for the construction of the bypass road and tunnel, Dominguez said.
The DOF had also signed the financing agreements for grants amounting to a combined $97 million extended by the European Union (EU) for the government’s development and peace-building programs in Mindanao.
These grants are for the Mindanao Peace and Development Program-Rise Mindanao (Minpad-Rise Mindanao) and Support to Bangsamoro Transition Program (Subatra).
“The projects focus on strengthening the institutions of the newly formed Bangsamoro autonomous government, creating jobs and improving community-based infrastructure in the region’s agricultural communities,” Dominguez said.
Last month, the EU extended a new grant worth $29 million for the Mindanao Peace and Development Programme (Minpad)-Peace and Development in the Barmm (Minpad-PD Barmm) to help strengthen the government’s ongoing confidence-building initiatives in the Barmm and assist in the recovery and rehabilitation of Marawi City.
Dominguez underscored at the business forum the key role played by the business community, spearheaded by the PCCI, in mobilizing multisectoral support behind the Duterte administration’s game-changing reforms that have propped up the country’s fiscal position ahead of the global crisis triggered by the coronavirus pandemic.
As a result of the country’s strong fiscal position, the government has had sufficient means to ramp up public spending to beef up the domestic healthcare system and provide relief to individuals and sectors hardest hit by the pandemic when strict lockdowns were put in place to save lives and protect communities from Covid-19, Dominguez said.
He said that following the gradual easing of the lockdowns, signs of recovery have started to emerge, as reflected in the declining unemployment rate, the continuous slower contraction in the manufacturing sector and improved tax collections.
However, he said that further improvements in the job numbers and other economic indicators will depend in large part on how quarantine measures will be further relaxed by opening up additional modes of public transportation that are safe and compliant with stringent health standards so that more and more people can get back to work.
Dominguez said any return to strict quarantine protocols will be more painful for the economy, which contracted nine percent in the first half of 2020.
The pre-pandemic reforms recommended in past Sulong Pilipinas workshops by the private sector, and which were later on put in place by the government with the support of the PCCI and the rest of the business community, have made the country better prepared now more than ever in meeting the challenges of “black swan” events such as the Covid-19 pandemic, which has put lives and livelihoods at serious risk, Dominguez said.
These PCCI-backed reforms include the Tax Reform for Acceleration and Inclusion (Train) Law; the amnesties on the estate taxes and delinquencies; and the increases in “sin” taxes to fund the Universal Health Care (UHC) program, he said.
Dominguez also cited the business community’s support for the annual Sulong events that led to the enactment of the National ID System and the Ease of Doing Business (EODB) Act, and the implementation of the fuel marking program and the President’s signature “Build, Build, Build” program.
He said that in this time of crisis when the economy has been set back by the country’s efforts to fight the pandemic, “it is always good to touch base with the business community” as “there is much to learn from those who have skin in the game.”
“While our medical workers braved the frontlines to save lives and treat the infected, you—our entrepreneurs—have been fighting in the trenches to save jobs and bring back our economy to the track of high growth. The country is grateful for your efforts,” Dominguez said.
Dominguez said the country’s strong fiscal and economic status resulting from the reforms supported by PCCI and the rest of the business sector enabled the government to quickly access emergency funds for its Covid-19 response efforts, both from the Philippines’ development partners and the commercial markets at easier and longer repayment terms.
He stressed, though, that despite the country’s ability to access funds for its Covid-19 response, there is a need for continued fiscal prudence as it remains uncertain when the pandemic will end.
Dominguez thanked the Congress anew for passing a fiscally responsible Bayanihan To Recover As One Act or Bayanihan 2, and called again on lawmakers to swiftly pass the remaining components of the country’s comprehensive plan to overcome the pandemic-induced crisis.
These include the 2021 national budget plan; the proposed Financial Institutions’ Strategic Transfer (FIST) Act, which will allow banks to dispose of bad loans and non-performing assets (NPAs) through asset management companies; and the Government Financial Institutions’ Unified Initiatives to Distressed Enterprises for Economic Recovery (Guide) bill, which seeks to allow state-run banks to form a special holding company that will infuse equity, with strict conditions, into strategically important companies facing insolvency.
Dominguez said the proposed Corporate Recovery and Tax Incentives for Enterprises Act (Create), which will immediately lower the corporate income tax (CIT) rate from 30 to 25 percent once made effective and will enhance the flexibility and efficiency of the incentives system for businesses, complete the list of priority measures that the Congress needs to swiftly pass to ensure the country’s speedy and strong recovery from the prolonged health emergency that has battered the global economy.
The “Build, Build, Build” program continues to be the centerpiece of the government’s economic recovery plan as investing in sound infrastructure has the largest multiplier effect on the economy, Dominguez said. (PR)