THE P500-million loan which the provincial government of Negros Occidental is sourcing to fund its proposed infrastructure projects will come solely from the Land Bank of the Philippines (LBP).
Of all the banks who offered loans, the province has chosen the 3.9 percent interest rate of LBP, said Second District Board Member Salvador Escalante Jr., chairman of committee on budget, finance and appropriation.
Escalante said that part of the LBP offer is to absorb the gross receipts tax (GRT), which is usually being charged by the banks to the party incurring the loan especially when the interest rate is over 3.5 percent.
“Thus, the offer of the Land Bank would be advantageous to the province,” he reiterated.
Aside from LBP, the province had earlier expressed interest to also negotiate loans with the Development Bank of the Philippines (DBP) and Philippine Veterans Bank (PVB).
Escalante said these creditor banks are already active participants of various projects, and undertakings of the provincial government, however, the LBP submitted the best offer.
The P500-million proposed loan will cover four projects, including the P185.9-million renovation and expansion of the Provincial Administration Center (PAC), P115.5-million construction of the Negros First Food Terminal (Bagsakan), P113.9-million development of the Capitol-run Sweet City Captel, making it as Negros First Hostel, and the P84.8-million renovation and construction of Mambukal Mountain Resort Hotel and Convention Center.
On February 17, the Provincial Board unanimously approved the resolution authorizing Governor Alfredo Marañon Jr. to negotiate loans with the banks.
On March 16, the Provincial Board has given him the authority to sign a loan agreement with LBP.
Escalante said the loan agreement will still be forwarded to the Bangko Sentral ng Pilipinas for its approval.
“When it goes back to the province, this will be the basis now for our bidding and procurement process,” he pointed out.
These infrastructure projects, which are mostly for income generation, are positioned to further boost the province’s economic development initiatives.